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Cinema Acquisitions

The Big Picture (TBP) has previously been engaged to assist in putting a cinema estate (usually one, two or three sites) up for sale. The sales process begins with a review of the company's more recent performance and ensuring a robust business plan (including the P&L) is in place. Simultaneously we’ll flag any concerns or question marks that may arise through investigating these areas at this early stage.

Our investigations will lead us to produce a business plan for the current and projected performance of the estate being sold. The bottom line is: can the cinema function as a profitable business? We’ll then carry out a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis but with less of a focus on 'Threats', which is less relevant in this specific context.

From this analysis we’ll build a prospectus which will then be taken out to a list of industry contacts to see which potential operators show interest. From that shortlist we’ll provide details on each possible “candidate” - who they are, what type of cinemas they operate, what future plans they have. The remaining options will be further discussed in detail until the right deal is agreed upon.

A sale is easier to facilitate if the terms are straightforward. But there are other factors to consider, for example, if the cinema estate is connected, to a shopping mall or any other businesses. If this is the case then it’s important to “get the right fit” - a seemingly vague objective but an essential one, meaning the cinema buyer has to fulfil any necessary requirements and positioning so that the cinema and the shopping centre can both thrive. Long term planning and a collaborative, open-minded approach is key here.

Surrounding Context of a Sale

If a private equity firm is looking to acquire a multisite company then a high level of analysis will be needed across the estate in question, looking at site performances on an individual basis and related operating costs. The more detail supplied in this regard, the better. And if this can give a clear snapshot of a sound business with a future strategy, this is more like to be the desired acquisition. A full understanding of the existing business, prior to a purchase, is critical to a client's decision making process.

Acquisition for Private Equity

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