Cineworld announces £1.7bn rights issue for Regal acquisition as revenues rise

 
Courtney Goldsmith
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'Star Wars: The Last Jedi' European Premiere - Red Carpet Arrivals
Star Wars: The Last Jedi was one of 2017's blockbusters (Source: Getty)

Cineworld has announced a fully underwritten rights issue to raise £1.7bn to finance its $3.6bn (£2.6bn) acquisition of US rival Regal Entertainment, as 2017 sales jumped.

The cinema chain said investors will receive four shares for every one they hold.

Cineworld's tie-up with Regal would create the world's second-biggest cinema operator behind AMC Entertainment, but not everyone is pleased with the deal.

One of the UK's best known asset managers, Jupiter Asset Management, which is also a shareholder in Cineworld, condemned the deal last year, saying the chain would bite off more than it could chew by entering the US markets, which it sees as a massive unknown.

Revenues rise

In a trading statement, Cineworld also announced revenue had grown by 11.6 per cent in the year to 31 December driven by expansion of the estate, an ongoing refurbishment programme and the roll-out of premium formats.

The biggest films of the year were Beauty and the Beast, Star Wars: The Last Jedi and Dunkirk.

Cineworld said it was "well positioned" for 2018, with a strong film slate including a number of big-name sequels like Jurassic World: Fallen Kingdom, Fantastic Beasts: The Crimes of Grindelwald, Avengers: Infinity War, The Incredibles 2, Mamma Mia! Here We Go Again, Solo: A Star Wars Story, Deadpool 2, Fifty Shades Freed and Mary Poppins Returns.

Shares in the company fell 4.44 per cent to 538.5p at the market open.

Read more: Cineworld has announced a blockbuster £2.7bn deal for this US cinema chain

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