Friday 29 January 2021 10:18 am

Takeover talk mounts as Chinese tycoon ups stake in Cineworld

A secretive Chinese tycoon has increased his stake in Cineworld, fuelling speculation of a possible takeover offer for the UK’s largest cinema chain.

Liu Zaiwang’s Jangho Group has built its holding in Cineworld to 13.3 per cent, according to stock market filings published yesterday.

The Chinese magnate, whose net worth is valued at $760m (£556m) by Forbes, has been quietly increasing his holding in the London-listed company over the last year.

Cineworld has seen its share price plummet 60 per cent in the last year as the outbreak of coronavirus sparked long periods of cinema closures, and is among the most shorted stocks.

Liu’s moves have sparked speculation that the tycoon, who made his fortune in the construction industry, could be preparing a take-private bid.

“There was chatter about that last year, so I think the way he’s slowly building his stake indicates something is afoot,” Neil Wilson at told City A.M.

Global City Holdings, the investment vehicle run by Cineworld chief executive Mooky Greidinger, remains the company’s largest shareholder.

Analysts have speculated that Greidinger could be tempted to take the business private himself to fend off pressure from Jangho Group.

It comes amid a spike in Cineworld’s shares caused by a frenzy of stock market activity fuelled by Reddit day traders.

Cineworld was one of a number of highly-shorted stocks to rise sharply this week amid concerns about a short squeeze.

Social media traders appeared to be attempting to drive up Cineworld’s share price following Lui’s share purchase.

In a post this morning the Reddit Trading UK Twitter account, which has Cineworld’s logo as its cover photo, said: “#CINE get ready, significant buys starting to come in and shorts are reducing. That can mean only one thing.”

Cineworld has been contacted for comment.