# Cineplex Inc. CGX



## redsgomarching (Mar 6, 2016)

Good report coming out. Everybody go watch your movies!!! Make sure you buy popcorn and a drink! Thanks!!!


----------



## nobleea (Oct 11, 2013)

redsgomarching said:


> Good report coming out. Everybody go watch your movies!!! Make sure you buy popcorn and a drink! Thanks!!!


Cineplex agreed to be purchase by UK based Cineworld last year. The price was $34/share. CGX is now trading under $10.
Cineworld said as recently as last week that it still intends to complete the transaction in the first half of 2020. Financing's been arranged.
I'm not sure they can back out of it now, but would think there's maybe some kind of break free if they do?

Or does it still go ahead and this is a good gamble?


----------



## doctrine (Sep 30, 2011)

Getting almost 4 to 1 on your money to be right that the deal goes through. It all depends on the conditions...CGX mentioned a debt condition, and if its some kind of debt to EBITDA based on anything that is happening now then you can forget about it - CGX just closed every theatre.


----------



## OptsyEagle (Nov 29, 2009)

There is almost always a way out. Sounds like Cineplex is still hoping but they seem to disclose here some of the things that will kaibosh the deal. I suspect it is as good as dead but that is more of what I would do, if I was the buyer, then an educated opinion on what is legal etc.

https://web.tmxmoney.com/article.php?newsid=6849802365159668&qm_symbol=CGX


----------



## nobleea (Oct 11, 2013)

Looks like the debt condition is on the buyer not Cineplex. If they back out, apparently a 50M break fee is due to CGX, which is about 0.75/share.
4 or 5 days ago everyone (the buyer) were expecting it to proceed. Analysts suggest it might be delayed til later in the year.
But that was last week and things are changing fast.

Could probably pick up July call options for pennies as a lottery ticket.


----------



## nobleea (Oct 11, 2013)

The purchasing company (Cineworld) is up something like 120% today.


----------



## nobleea (Oct 11, 2013)

Apparently Cineplex hasn't broken any of its covenants yet for this deal. Stock is pushing $15 now.


----------



## nobleea (Oct 11, 2013)

Close to $17 now. The Brits might have to go ahead with the purchase at $34 after all.


----------

