Carmike Postpones Vote on Sale to AMC to Continue Discussionsby
Shareholder vote on cinema merger is rescheduled for July 25
AMC has said it’s still open to deal after Odeon acquisition
Carmike Cinemas Inc. is postponing a shareholder vote on its proposed $1.1 billion sale to AMC Entertainment Holdings Inc. for a second time to allow for more talks on a deal that would combine two of the largest U.S. theater chains.
The buyout faces opposition from Carmike’s largest shareholders, who say the price is too low. The decision to put off the vote, which had been set for Friday, has been rescheduled for July 25, Carmike said in a statement. The delay gives AMC more time to decide whether to raise its bid for the Columbus, Georgia-based chain or walk away.
AMC, controlled by Wang Jianlin, China’s second-richest man, is trying to acquire Carmike for $30 a share in a deal that would make the company the largest U.S. movie exhibitor. AMC, based in Leawood, Kansas, is No. 2 behind Regal Entertainment Group. The company agreed earlier this week to acquire U.K. cinema chain Odeon & UCI Cinemas Group for $1.2 billion, but said it was still willing to save the Carmike transaction if it could reach acceptable terms.
Carmike’s two largest shareholders -- Mittleman Brothers LLC and Driehaus Capital Management LLC -- oppose the deal. Together they own about 20 percent of the theater chain, according to data compiled by Bloomberg. AMC’s Chief Executive Officer Adam Aron said this week he’s unwilling to pay the $40 a share sought by some investors.
The investors were joined by two shareholder advisory firms, Glass Lewis & Co. and Institutional Shareholder Services Inc., which came out against the deal on June 17. They too said the offer undervalued Carmike.