After speculation of a possible bankruptcy swarmed the news desks last year, AMC theater group was able to stave off the filing and remain in operation. However, economic pressures have recently led the entertainment company towards a buyout option to resolve its financial issues. The buyout comes by way of a Chinese company, who is seeking to expand their international presence and will produce the world’s largest movie theater company in history.
AMC Entertainment is set to break a record in the largest acquisition of a U.S. company by a Chinese group. Dalian Wanda Group Corp. Ltd. has agreed to pay Kansas City, MO-based AMC $2.6 billion for the buyout of right to the AMC theater group. Dalian will also absorb 346 cinemas and about $2 billion in debt liabilities through the acquisition.
Part of the appeal for Dalian comes by way of becoming the world’s leader in the cinema market. Dalian will also gain control of over 2,300 3-D theaters and 128 IMAX screens, both of which yield higher profit margins than traditional theaters. Part of the acquisition plan is to reduce some of AMC’s current debt burden, along with upgrade and renovate many of the facilities currently operating. Dalian has also planned to keep all theaters in operation, an option that was once threatened when AMC hit financially hard times.