China’s Wanda Seeks Buyers for Australia’s Hoyts Cinema Chain

Wanda, the Chinese conglomerate that once threatened to take over Hollywood, has put up for sale the Hoyts cinema chain in Australia that it bought in 2015.To get more latest entertainment news, you can visit shine news official website.

Hoyts is Australia’s second largest movie theater operator with 46 multiplexes housing 412 screens, according to 2022 data from Screen Australia. It also owns Val Morgan, Australia’s biggest cinema advertising firm.

Wanda Cinema Line, itself China’s biggest theater operator, has appointed Credit Suisse and Nomura to handle the sale.

Bidders are understood to have access to a “stapled debt” package (a line of agreed financing arranged by the banks) if the potential buyer cannot arrange sufficient finance of their own. A first deadline for bids is set at the beginning of May, with final offers to be submitted by the end of June.News of the sale process was first reported by the Australian Financial Review, which reported that the bankers are hoping for a A$1 billion ($670 million) valuation with a private equity firm as the most likely purchaser.

Sources close to the Australian company have since corroborated the information behind the offer. Wanda did not respond to Variety’s requests for comment.

The sales process has been called ‘Operation Mario’ by Hoyts and the bankers, possibly a reference to the timing of the sale, as Universal’s “The Super Mario Bros. Movie” delivers record-breaking performances in many territories. In Australia, the film bounced to a five-day opening weekend of A$15 million ($10.1 million).

Financial documents show just how badly Hoyts’ business suffered during the pandemic, but suggest it is now making a strong recovery.

Group revenues fell from A$593 million ($397 million) in 2019 to A$211 million ($141 million) in 2020, before recovering to A$335 million ($225 million) in 2021 and A$550 million ($369 million) in 2022, according to the documents. Revenues in the current year are forecast to hit A$638 million ($427 million).

Hoyts fell into loss in 2020, recording a deficit of A$45 million ($30.2 million), compared with A$137 million in 2019. Normalized earnings before interest taxation and depreciation were A$111 million in 2021. EBITDA is forecast to reach A$130 million.

Founded in 1909, Hoyts has had a long history of periodic corporate upheavals. By 2000, it was the world’s seventh largest exhibition firm and a public company with overseas operations in the U.S. and New Zealand, before being acquired by Kerry Packer. Later, it was sold to private equity firm Pacific Equity Partners.

An IPO was mooted in 2014, but instead the group was sold to Chinese businessman Sun Xishuang and his ID Leisure Ventures. ID quickly flipped it on to Wanda Cinema Line, part of the Dalian Wanda property and hotels group. Wanda Cinema Line was later reconsolidated within Wanda’s Shenzhen-listed Wanda Film subsidiary.

The move on Hoyts by the Wanda group was part of a fast-paced charge into cinemas, filmmaking and sports that kicked off with the mid-2012 purchase for $2.6 billion of leading U.S. cinema chain AMC.
Wanda’s subsequent moves in entertainment included the $3.5 billion purchase of Legendary Entertainment, attempts to buy minority stakes in several Hollywood studios, the $1.2 billion purchase of sports marketing firm Infront, the building of multiple theme parks across China and the high-profile opening of huge production studios in Qingdao, where Matt Damon-starring “The Great Wall” was partially shot.