As you all may have heard AMC is on the sell block for $2.6 bln ($1.9 bln of debt) to Chinese company Dalian Wanda Group Co., Ltd. AMC, the second-largest theater chain in the USA and acquisition will create the world's largest theater group.
Questions for All:
Does AMC (American Multi-Cinema) now change its name to: Chinese Multi-Cinema? *snark
Are you going to boycott AMC if the deal is approved by regulators? Is Regal Cinemas looking better as a destination?
For countries, like China that mandate you take a local partner to consummate a deal, why doesn't or shouldn't the U.S. reciprocate and mandate a local U.S. partner for firms whose management consists of foreign nationals of restrictive countries? Is this a wise mercantilist strategy?
Your feeling on the U.S. Government giving it's blessing to another American commercial icon going into foreign hands, i.e. Inbev's purchase of the Budweiser.
What will AMC's credit rating be and capital structure look like going forward?
What is on the horizon for Chinese M&A in the U.S. Aside from this deal, in the banking sector Industrial & Commercial Bank of China Ltd., will buy an 80% stake in the U.S. subsidiary of Bank of East Asia, a Hong Kong company that has 13 branches in New York and California. Recently, the Fed granted approval to Agricultural Bank of China Ltd. to build a branch in New York City, and to Bank of China Ltd. to build a branch in Chicago. Both are based in Beijing. Bank of China already has two branches in New York and one in Los Angeles.
(all your theaters are belong to us bitchez)
Why would I boycott? Everything i use is made in China anyway...
lol the Chinese pirate all our shit and then buy a movie theater? wtf don't they get? Maybe they just really like popcorn...
I honestly don't care about who owns the business. The whole thing about capitalism (I realize the Chinese are commies) is that the best survive. At least that's how it's supposed to work. So I will pay for the best service, regardless if it is provided by mid-western famers or cackling Soviets. That's more American to me that protectionism.
Are you going to boycott AMC if the deal is approved by regulators? Is Regal Cinemas looking better as a destination? In NYC at least, AMC has better theaters and great matinee specials. With the Wanda cash infusion, AMC will have a capital infusion to further upgrade their theaters etc. which would make them even more attractive compared to Regal and others. I hope they keep the matinee thou.
For countries, like China that mandate you take a local partner to consummate a deal, why doesn't or shouldn't the U.S. reciprocate and mandate a local U.S. partner for firms whose management consists of foreign nationals of restrictive countries?
So if your competitor enters into the boxing ring blind-folded, are you going to mimic him too? Protectionism hinders innovation and begets mediocrity. In any case, the reputable Chinese companies who make acquisitions in the U.S have been careful to team up with local partners which helps them better understand the U.S market and consumers.
Your feeling on the U.S. Government giving it's blessing to another American commercial icon going into foreign hands, i.e. Inbev's purchase of the Budweiser.
AMC was owned by a consortium of private equity firms including Apollo and Bain who are now cashing out on their investments. In so far as these PE firms have international investors in their funds, AMC is already owned by foreign interests. It hasn't been a family owned All-American company for quite sometime now. The U.S government has no reason whatsoever to block this deal as AMC is just a movie chain and is of no concern to national security or classified intelligence. Also thanks to Inbev's acquisition of Budweiser Stella Artois is now much more widely available in the U.S than before.
What will AMC's credit rating be and capital structure look like going forward? It would look better with the $500 mm cash infusion from Wanda. Wanda is a reputable company with healthy cash flows and eager to make inroads in the U.S. Having their support definitely puts AMC in better financial footings and will help its credit rating.
Also one should differentiate between the Wanda acquisition from the Chinese banks' acquisitions. The Chinese banks are State owned while Wanda is an entirely private conglomerate.
Bloomberg has a good write up on this story: http://www.bloomberg.com/news/2012-05-21/china-s-wanda-group-to-buy-amc…
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