Proactive Investors - Britain's third-biggest cinema chain is ready to swoop on a rival in a “huge consolidation play” ahead of a possible stock market flotation, according to The Times.
The report said Tim Richards, who founded Vue International in 1999, has confirmed the company was ready to take advantage of any opportunities that presented themselves as speculation mounts that Cineworld Group PLC (LON:CINE) could be broken up.
Vue, which trails behind Odeon and Cineworld, has 91 venues across the UK and Ireland with 870 screens. Overall, it has 227 sites in nine countries with 10,000 employees.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown (LON:HRGV) pointed out: “It’s only recently that Vue went through a protracted and painful £1bn restructuring, so this brazen M&A attitude may not sit well with its rescuers. Vue’s aspirations are certainly heady and include a potential stock market flotation within the next couple of years.”
“As and when a listing occurs, the market will certainly need some convincing that Vue has the strength and stamina to excel over the long-term after the systemic changes that have occurred in entertainment,” she added.
Shares in Cineworld jumped on the news rising 11% to 5.10p. The embattled cinema chain recently agreed a bankruptcy settlement with its landlords and lenders after filing for bankruptcy protection in Texas in September.