Carmike Cinemas Inc fka CKEC

[Enterprising Investor]

Carmike Cinemas Acquires Sundance Cinemas (10/06/15)

COLUMBUS, Ga. & LOS ANGELES--(BUSINESS WIRE)--Carmike Cinemas, Inc. (NASDAQ: CKEC) (“Carmike”), a leading digital cinema, alternative programming and 3-D motion picture presenter, today announced that it has entered into a definitive purchase agreement under which Carmike acquired all of Sundance Cinemas, LLC (“Sundance”) for $36.0 million in cash, subject to customary working capital and other adjustments. The transaction simultaneously closed upon signing of the purchase agreement. Upon completion of this transaction, Carmike operates 274 theatres with 2,909 screens in 41 states.

The acquisition is expected to be immediately accretive (net of one-time transaction costs), on an EPS, EBITDA, and cash flow basis and is projected to add incremental revenue of $24 million and, after general and administrative synergies, pro forma EBITDA of $5.6 million to Carmike’s financials for the trailing twelve month period ended June 30, 2015. A reconciliation of net income to pro forma EBITDA (a non-GAAP measure) is included below.

Sundance theatres acquired (Screens/3D Screens):

Sundance Kabuki, San Francisco, CA 8/2
Sundance Cinemas Houston, Houston, TX 8/2
Sundance Cinemas Madison, Madison, WI 6/0
Sundance Sunset, West Hollywood, CA 5/0
Sundance Cinemas Seattle, Seattle, WA 10/3

Carmike’s President and Chief Executive Officer David Passman stated, “Sundance has been enormously successful in creating a compelling consumer experience and shares our mission and vision of offering a world class movie-going experience, including an impressive premium dining offering. Not only are these five theaters located in complementary locations with limited geographic overlap with our existing circuit, but they also offer tremendous opportunity to implement Carmike’s proven and successful guest experience strategies and combine our resources to achieve greater innovation that will benefit consumers, theater operations and increase shareholder value. We expect that this acquisition will allow Carmike to capture proportionally higher attendance rates for non-blockbuster titles and provide additional luxury expansion opportunities and meaningful cost synergies as we increase scale to optimize film exhibition and other support costs.”

Paul Richardson, Sundance Cinemas’ Chief Executive Officer commented “We are excited to join Carmike which brings together two exceptional organizations with a common culture of innovation and customer focus. Sundance has worked hard to deliver the highest levels of customer service across our theaters and we look forward to working together to increase Carmike’s leadership position in cinema dining and overall movie-going experience.”

The transaction does not provide for the expansion of the Sundance brand under Carmike’s ownership, however Carmike will have the ability under a license with Sundance Enterprises Inc. to continue to operate Sundance’s five theatres under the Sundance brand. King & Spalding LLP acted as legal counsel to Carmike Cinemas in this transaction. Salem Partners LLC acted as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal counsel to Sundance Cinemas, LLC in this transaction.

About Carmike Cinemas (www.carmike.com)

Carmike Cinemas, Inc. is a U.S. leader in digital cinema, 3-D cinema deployments and alternative programming and is one of the nation's largest motion picture exhibitors. Carmike has 274 theatres with 2,909 screens in 41 states. The circuit includes 48 premium large format (PLF) auditoriums featuring state-of-the-art technology and luxurious seating, including 30 "BigDs," 16 IMAX auditoriums and two MuviXL screens. As "America's Hometown Theatre Chain" Carmike's primary focus is mid-sized communities. Visit www.carmike.com for exact show-times and to purchase tickets.

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