Famous Players relented last week and decided to abandon their brilliant, ingenius, fantastic gay ‘marriage’ ads strategy. Now they reveal they’re on the block.
Famous Players on block
107 movie theatres: Parent Viacom shops chain as attendance drops
Media giant Viacom Inc. has placed Famous Players, Canada’s largest movie theatre business, on the auction block.Viacom, which is based in New York and owns Paramount Pictures and television networks CBS, MTV and Nickelodeon, would not comment on why it is shopping Famous Players, which operates 107 locations and about 856 screens across Canada.
“I really have no comment beyond that we plan to divest the operations,” said Carl Folta, Viacom’s executive vice-president of corporate operations.
The company had not previously disclosed it was selling the chain, although executives at Famous Players in Canada said Viacom had been shopping the company for a couple of months.
Famous Players recently lowered ticket prices in Toronto and other Ontario cities to $9.95 from $13.95, after cutting prices in other major Canadian centres.
The move, which followed a similar price cut by Cineplex Galaxy, is aimed at drawing back to theatres customers who have grown accustomed to watching DVDs in their homes.
No valuation was placed on Famous Players by Viacom, but it could be more than the $175-million Onex Corp. raised last November when it spun off Cineplex Galaxy. Onex had hoped to raise up to $270-million but was forced to revise its valuation.
Cineplex Galaxy Cinemas is the No. 2 theatre chain in Canada, operating 737 screens in 82 theatres. The company operates as an income trust, and had revenue of $353.7-million in 2004, up from $335.8-million a year earlier. The chain earned $17.2-million, paying an 11.5% yield to unitholders.
Viacom’s co-presidents, former MTV Networks chair Tom Freston and CBS chair Leslie Moonves, had been reviewing all the company’s assets recently for a potential sale.
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