A major change is underway in the country's entertainment industry.

Canada’s largest movie exhibition chain says it will be taken over by a British corporation that will subsequently become one of the biggest cinema companies in the world.

Canadian entertainment company Cineplex announced today (December 16) that it will be acquired by the United Kingdom’s Cineworld Group for a total transaction value of approximately $2.8 billion including debt.

Cineworld, founded in 1995, will pay $34 in cash for each Cineplex share, which represents a 42 percent premium of the closing price for Cineplex shares on December 13.

The news sent Cineplex shares soaring by more than 40 percent today, reaching $33.88 as of this writing. Its 52-week high is $34.06.

Cineplex went public in 2003 and Cineplex president and CEO Ellis Jacob stated in a news release that the company believes the transaction is in its shareholders’ best interest.

The Cineplex news release states that the company’s history of “supporting the Canadian entertainment industry and its partners in the arts, including support for film festivals, programs and industry events across Canada, will continue”. 

Although the transaction is expected to close during the first half of 2020, Cineplex will have seven weeks (until February 2) to solicit and negotiate with other buyers.

Cineworld will add Cineplex’s 165 movie theatres across Canada to its roster of 9,498 screens in the U.K., U.S., Ireland, Poland, the Czech Republic, Hungary, Bulgaria, Slovakia, Romania, and Israel.

While Cineplex screens movies to over 70 million customers each year, it also operates CineplexStore.com for digital commerce, food service, place-based Cineplex Digital Media, Player One Amusement Group, Playdium and Rec Room entertainment complexes, cinema media, and WorldGaming Network online esports, and will launch Topgolf sports and entertainment venues across Canada.   

On April 3, Cineplex opened their first VIP Cinemas on the North Shore, the 11-auditorium Cineplex Cinemas Park Royal and VIP, at Park Royal Shopping Centre in West Vancouver. The theatre replaced the six-auditorium theatre Cineplex Cinemas Esplanade, which closed down at 200 West Esplanade in North Vancouver.

Cineplex opened their first VIP Cinemas in B.C. in Coquitlam in 2011, with an official grand opening in April 2012. It was followed by a VIP Cinema at Marine Gateway which officially opened in March 2016. It will open the food-and-entertainment Rec Room at Brentwood Town Centre in Burnaby later this year and at 885 Granville Street in Downtown Vancouver in 2021. In September 2018, Cineplex announced that it will also launch 4D and virtual-reality features at its theatres across Canada.

Last week in Quebec, Cineplex announced on December 12 that it plans to open a new VIP Cinemas at Cineplex Cinemas Forum in Montreal in April 2020; a new Playdium entertainment complex in Brossard in late 2020; and a VIP Cinemas and The Rec Room at Royalmount 2021, with a target opening of 2022.

Cineplex employs approximately 13,000 people across Canada and the United States.