The Financial Times reports that up to seven bidders are interested in the UK theater chain being sold by Sumner Redstone’s National Amusements Inc. (NAI) to raise cash and protect his investments in CBS and Viacom. However, the FT indicates that first-round bids were less than aggressive.
NAI needs to sell off some assets to reduce debt under the deal it cut earlier this year to refinance $1.6 billion of debt. In fact, the entire amount has to be repaid or refinanced by the end of 2010, but some comes due yet this year.
A year and a half ago, the UK cinema assets were valued at a half billion bucks. Not surprisingly, the valuation by potential buyers is considerably less in the current economy.
The FT report said bidders going on to the second round include the UK’s three largest theater chain owners, but that an outright purchase of the entire package by any one of them would likely raise antitrust issues.