Hinted at weeks ago, AMC is being sold to China’s Wanda Group for $2.6 Billion. Their headquarters will remain in Kansas City and the new owner will continue their strategic upgrades plan.
Read more in the Huffington Post.
some people who go to amc are complaining about the deal on the company’s facebook page and emailing the company and tweeting amc about how china will handle what will become the largest cinema chain in the world. Regal is still the largest in America.
The comments on Facebook are kind of hilarious – especially ones about AMC deleting comments as a “communist” move. But I don’t see how this is any different than their present ownership. I remember Loews after Sony sold it (I think to Bain Capital….they there’s a name that’s been coming up lately) – over night it went from being well run to being dirty, short staffed with little care for presentation. There are other foreign firms running cinemas in the US – including Big Cinemas (from India) and Cineoplis (from Mexico), and a few chains run by owners whose values I don’t share (Kerasotes racist decision in certain inner-city neighborhoods for one).
With this said, culturally this is sensitive – AMC is one of the oldest exhibitors, an iconic brand that happens to be based right in the center of the country: I see this outrage even though I view the deal as nothing more than an equity stake in the company – if Wanda isn’t achieving a substantial rate of return on their investment they’ll sell it off to someone else. But because it is China (and I’ll give the protestors the benefit of the doubt and assume they’re mostly talking about human rights abuses in their opposition to China) – it presents a psychological problem.
Still the deal is slightly perplexing: I happen to think Wanda is achieving a few things – they are first testing the waters with a big American brand investment (they have been talking about acquiring hotels in the US next), and – to a lesser extent AMC’s management experience (which is somewhat spotty although perhaps they buy into Lopez’s new vision for the company). AMC has certainly learned from its mistakes (no more 20+ plexes), but a management team can be bought for much cheaper – a few million verses two billion+.
I don’t think Wanda will be involved in large day to day activities and programing as FB speculates, but I imagine American studios are excited and there is some synergy that might thaw US-China relations if we can expand the number of titles China allows us to export. Still, cultural protections are important for any film industry (I know, even communists) – but consider the mission of the NFB in Canada, it achieves roughly the same end (to foster talent and export an image of a nation to itself and abroad). It should be interesting to see what happens with this deal, but I imagine if AMC can’t perform (I don’t think its entirely a debt issue), Wanda will sell it off.
We all have such short memories. Don’t we remember how in the 1980s Japanese companies tried to buy up Hollywood? This is a business deal, pure and simple. Maybe Wanda’s investment will pay off. Maybe it won’t. It always amuses me that when an Asian country makes a big investment in an America, people get all heated up. As far as I know, the biggest investment in the US has been from the UK.
What’s next? A communist Chinese from China elected president of the US?