TORONTO, June 1, 2020 /CNW/ - (TSX: CGX) – Cineplex Inc. ("Cineplex") today provided an update on the status of the process to obtain Investment Canada Act approval (the "ICA Approval") in connection with its previously-announced transaction with Cineworld Group plc (LSE: CINE) ("Cineworld") pursuant to which an indirect wholly-owned subsidiary of Cineworld has agreed to acquire all of the issued and outstanding common shares of Cineplex (the "Transaction").
Pursuant to the arrangement agreement among Cineplex and Cineworld dated December 15, 2019 (the "Arrangement Agreement"), Cineworld and Cineplex are obligated to use reasonable best efforts to obtain the requisite ICA Approval so as to enable the closing of the Transaction to occur as soon as reasonably practicable (and in any event no later than June 30, 2020 (the "Outside Date")). Receipt of the ICA Approval is a condition to closing the Transaction. The process to obtain the approvals under the Investment Canada Act is ongoing and the period for review of the Transaction has been extended to June 15, 2020.
Closing of the Transaction remains subject to the satisfaction or waiver of certain conditions that have not yet been satisfied, including receipt of the ICA Approval, the representations and warranties of the parties remaining true and correct (subject to certain materiality qualifiers), the parties having fulfilled or complied in all material respects with each of their covenants contained in the Arrangement Agreement, and as at the date of closing of the Transaction, Cineplex shall have no more than $725 million outstanding under its credit agreement, subject to certain exclusions. There can be no assurance that the ICA Approval or the other conditions to closing the Transaction will be satisfied or waived by the Outside Date, in which case the Transaction would not be completed.
Cineplex also announced that it will be relying on the temporary blanket relief provided by the Ontario Securities Commission under Ontario Instrument 51-504 – Temporary Exemptions from Certain Requirements to File or Send Securityholder Materials to postpone the filing of its executive compensation disclosure.
The foregoing summary of certain provisions of the Arrangement Agreement is qualified in its entirety by the provisions of the Arrangement Agreement, a copy of which is available on SEDAR at www.sedar.com.
Cineplex (TSX:CGX) is a top-tier Canadian brand that operates in the Film Entertainment and Content, Amusement and Leisure, and Media sectors. A leading entertainment and media company, Cineplex welcomes millions of guests annually through its circuit of theatres and location based entertainment venues across the country. In addition to being Canada's largest and most innovative film exhibitor, Cineplex also operates successful businesses in digital commerce (CineplexStore.com), food service, alternative programming (Cineplex Events), cinema media (Cineplex Media), digital place-based media (Cineplex Digital Media) and amusement solutions (Player One Amusement Group). Additionally, Cineplex operates Canada's favourite destination for 'Eats & Entertainment' (The Rec Room) and entertainment complexes specially designed for teens and families (Playdium). Cineplex is a joint venture partner in SCENE, Canada's largest entertainment loyalty program.
Caution Regarding Forward-Looking Statements
Certain information included in this news release contains forward-looking statements within the meaning of applicable securities laws. The words "may," "will," "could," "should," "would," "suspect," "outlook," "believe," "plan," "anticipate," "estimate," "expect," "intend," "forecast," "objective" and "continue" (or the negative thereof), and words and expressions of similar import, are intended to identify forward-looking statements.
By their very nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Cineplex's control. The forward-looking statements contained in this news release are based on certain key expectations and assumptions made by Cineplex.
Forward-looking statements are subject to various risks and uncertainties which could cause actual results and experience to differ materially from the anticipated results or expectations expressed in this news release. The key risks and uncertainties include, but are not limited to: the impact of the COVID-19 pandemic on Cineplex, the motion picture exhibition industry and the economy in general, including Cineplex's response to the COVID-19 pandemic as it relates to theatre and venue closings, employee reductions and other cost-cutting measures, as well as increased expenses relating to safety measures taken at Cineplex's theatres and location based entertainment venues in order to protect the health and well-being of Cineplex's customers and employees; general global economic, market and business conditions; governmental and regulatory requirements and actions by governmental authorities; relationships with employees, customers, business partners and competitors; and diversion of management time on the Transaction. There are also risks that are inherent in the nature of the Transaction, including failure to satisfy the conditions to the completion of the Transaction and failure to obtain any required regulatory approvals (or to do so in a timely manner). The anticipated timeline for completion of the Transaction may change for a number of reasons, including the inability to secure necessary regulatory approvals in the time assumed or the need for additional time to satisfy the conditions to the completion of the Transaction. As a result of the foregoing, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release.
Cineplex does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable Canadian securities law. When reviewing Cineplex's forward-looking statements, readers should carefully consider the foregoing factors and other uncertainties and potential events. A comprehensive discussion of other risks that impact Cineplex can also be found in Cineplex's public filings which are available under Cineplex's profile on SEDAR at www.sedar.com.
For further information: Media Relations contact: Sarah Van Lange, Executive Director, Communications, [email protected], 416-323-6728; Investor Relations contact: Melissa Pressacco, Senior Manager, Communications and Investor Relations, [email protected], 416-323-6606