Mm2 Asia has acquired the cinema management and operations business of Lotus Fivestar Cinemas for 13 cinema locations. This is for a purchase consideration of RM118 million.
Upon completion, the group will own a total of 133 cinema screens in Malaysia, making it the fourth largest cinema operator in Malaysia. Previously, Mm2 Asia made acquisitions of cinemas from Cathay Cineplexes and Mega Cinemas Management. The acquisition of the Cathay cinema screens were valued at RM40 million and made last year in November.
The cinemas comprised in the business were established between 2009 and 2016, and currently comprise a total of 90 screens with a total of 15,818 seats. Its book value and net tangible asset value was RM48,226,279 as at 31 December 2015.
According to an SGXNET announcement, the ownership of cinemas through the acquisition will complement current and future businesses of mm2 Asia and strengthen its competitive advantage. It is in line with the company’s intention to diversify into the downstream value chain of film production.
In March this year, StarHub took a 9.05% per cent stake in mm2 Asia for SG$18,040,000. StarHub had been partnering Mm2 Asia since 2012, through successful investments in the Ah Boys To Men and Lion Men movie series which were co-produced by Mm2 Asia.