Cineworld Share Discussion Threads

[mozy123] 25/1/2018 08:57

Looks great value now. Cineworld p/e of 13 times forward, and 4% yield.

$ weakness is making thier regal purchase cheaper.

Good times.

[typo56] 23/1/2018 16:08

The existing shares are very volatile because they are heavily geared to the rights. This means a 5p move in CINE now represents just a 1p move in the ex-rights price.

[nav_mike] 23/1/2018 15:42

With the big drop in the price since the rights issue details were announced, the theoretical ex-rights price would be around 222 if calculated today, compared to the 238 when details came out.

Not the end of the world, but the rights issue discount @ 157 is shrinking by the day

[typo56] 23/1/2018 10:58

When searching for the Rights Prospectus I found the Prospectus for the rights issue from Jan 2014 relating to the acquisition of Cinema City. That was 8 for 25 @ 230p.

Sometimes I wonder if these 'deals' aren't egged on by the corporate advisors, with their lucrative fees!

[trytotakeiteasy] 23/1/2018 10:32

philanderer - global city only own 28% so other shareholders could block it. Some have said they will vote against.

[philanderer] 23/1/2018 10:29

Not much chance of that..

"Global City Holdings B.V. (the "Major Shareholder"), which holds in aggregate 76,626,344 Ordinary Shares as at the Latest Practicable Date (representing 28 per cent. of the Company's existing issued ordinary share capital) has agreed to take up its full pro rata entitlement under the terms of the Rights Issue, in order to maintain its shareholding in Cineworld and, following completion of the Acquisition ("Completion"), the Enlarged Group."


31 January 2018 (the "Record Date") ("Qualifying Shareholders"). The offer is to be made at 157 pence per New Ordinary Share (the "Rights Issue Price"), payable in full on acceptance by no later than 11.00 a.m. on 19 February 2018.

[trytotakeiteasy] 22/1/2018 18:31

So if shareholders vote no then the rights issue and the takeover both don't go ahead????? Given the share price reaction why would anyone vote yes??? What day are the shares ex-rights???

[philanderer] 22/1/2018 18:17

Yes at a General Meeting on 2nd february

[trytotakeiteasy] 22/1/2018 18:14

Don't they have to do a shareholder vote before the Rights Issue????

[ianood] 21/1/2018 13:23

"If USA stockmasrket contracts then this purchase looks expensive IMV"

Doesn't everything?

[philanderer] 21/1/2018 10:11

No sign of a picket line at the Shaftesbury Avenue Picturehouse yesterday. We were walking past on our way to the Curzon to see 'Three Billboards Outside Ebbing'

Top film :-)

[bscuit] 20/1/2018 12:33

according to Hackney only Ritzy closed. On face of it BECTU have indulged in wishful thinking, but who would check? Are BECTU a recognised by CINE as a TU?

If USA stockmasrket contracts then this purchase looks expensive IMV.

[typo56] 19/1/2018 19:19

Apart from stamp duty and dealer commission (which are worth saving) and assuming the market were to remain static, it doesn't really make any difference if you buy shares in the market now, or acquire via taking up the rights, or purchase the tradable rights and take up the rights, or just acquire the shares cheaper after the ex-rights date.

The rights don't actually give existing holders a 'special deal' as any apparent price advantage is offset by the fall in their qualifying holdings on ex-rights day (the theoretical ex-rights price being the no win, no lose level). Which is why I consider rights issues a devious blag for more funds!

[grahamburn] 19/1/2018 17:21

AndrewBaker

Interesting post and explanation of your strategy.

Though you say you will average down when the fall steadies, you do not say whether you will be participating in the hefty rights issue.

If you are not going to do that - at a substantial discount to the theoretical ex-rights price of 238p - then I struggle to follow your reasoning. After all, surely that would be the best strategy.... though maybe that is indeed your plan, as it would also prevent your holding being diluted post rights (assuming you take up your full entitlement).

[nav_mike] 19/1/2018 16:52

Once the deal has completed and any rights issue overhang has cleared, Im pretty certain CINE will be an excellent addition to anyone's portfolio

[andrewbaker] 19/1/2018 16:08

My post 1543 on here shows that I've been a holder for some time: and I'll continue to hold, and once again, when the fall steadies, and the price starts to move back up, albeit not for a while, I'll average down again and buy more. I'm still in capital profit from earlier purchases, plus I've enjoyed the dividends over my holding period.

The market is spooked by the massive acquisition and possible dilution from a cash call or borrowings; but I've got faith in what is being done, and will continue as a shareholder in what I believe to be a good business, and with so much more growth potential when the US deal settles. (And, repeating from my previous post, CINE are getting people to spend more, and moving their proposition upmarket.)

[hammers976] 17/1/2018 14:14

Mozy123...

They have assumed $100m "in run-rate EBITDA combination benefits".

[mozy123] 17/1/2018 11:52

What is the actual cost of this take over?

£1.7bn rights, £3bn debt, + balance sheet cash (x)

Regal makes £468m ebitda so I cant work back how Cineworld have stated they are buying it on an 8x ebitda multiple? Anyone help? Or is the costs savings in there?

5 February 2018 is the start of trading of the rights so i guess that when i will be able to see if the volitility creates a further opportunity.

If the combined can hold a valuation of 16-17 times earnings then there is some blue sky in the months ahead.

On 5 December 2017, Cineworld and Regal announced that they had reached agreement on the terms of a proposal for Cineworld to acquire, for cash, the entire issued and to be issued share capital of Regal. The Acquisition will be at a price of US$23.00 per Regal share, which values the entire issued and to be issued share capital of Regal at US$3.6 billion (£2.6 billion), with an implied enterprise value of US$5.8 billion (£4.2 billion).

[typo56] 17/1/2018 11:08

Expect CINE will be quite volatile up to XR date, given the gearing of more than doubling the market cap.

[nav_mike] 17/1/2018 10:24

Still working out the pros and cons to be honest.

Trading statement looked good, but thats a lot of new shares coming onto the market. I know its fully underwritten, but you have to hope that the take up will be good else there will be quite a glut of shares waiting to be fed back into the market.

Its quite tricky to work out whether to buy in before the XR date. Theoretical ex-rights price was 238.3 but initial reaction today has been pretty negative.

Think I will sit on my hands yet for a few days more

[typo56] 17/1/2018 09:55

Surprised no mention here of the trading statement and the rights issue details (4 for 1 @ 157p).

[philanderer] 12/1/2018 11:03

Peel Hunt 'hold' tp 600p reiterates.

Hoping to catch Oldman in 'Darkest Hour' over the weekend.