AIMCo, OMERS Take Cinema Chain on Second Attempt

(June 10, 2013) — A pair of giant Canadian investors has bought a UK-based cinema group some two and a half years after their initial bid for the company.

The Alberta Investment Management Corporation (AIMCo) and the Ontario Municipal Employees’ Retirement System (OMERS) and have agreed terms with private equity leader Doughty Hanson, the company which beat them to buy Vue Entertainment in November 2010.

The deal will see the Canadian duo commit £935 million to the acquisition, more than double the £450 million paid by Doughty Hanson, the company announced today.

To warrant this increased price tag, Vue Entertainment has more than doubled in size since the pension consortium missed out initially.

The entertainment firm has been expanded from owning and running 68 cinemas, offering 678 screens and sitting in third place in the UK sector in 2010, to operating 146 establishments with 1,321 screens.

In the period between the two deals, the entertainment company bought similar businesses in Poland and Germany, and shored up its prominence in the UK with the take-over of Apollo Cinemas last year, making it one of the largest in the world.

“I’m constantly building relationships globally because I believe in the power of trust-based relationships. A network of reliable, global partners will help AIMCo get the local knowledge of foreign markets it needs to succeed,” the fund’s Deputy CIO, Jagdeep Bachher, told aiCIO last year. He added that AIMCo should “become the first stop for companies and international institutional investors seeking a partner to help them become world class organizations.”

Last week, OMERS was part of a consortium making its second bid on UK utility company Severn Trent. The firm rejected the approach, saying it undervalued its worth and today the consortium has appeared to give up its chasing of the firm.

For a glance at how the largest Canadian institutional investors hold their assets (in their own words and pictures) click here.

Related content: Power 100-Michael Latimer, CIO, OMERS & Leo de Bever, CIO & CEO, AIMCo