The return to unified real estate ownership and operations by CCI will potentially position CCI in a competitively stronger position with regard to its cinema operations.

"Today we are announcing two very important agreements. After few years of separation we decided to consolidate under Cinema City all of the activities of Israel Theatres group together with cinema operations of Cinema City. We came to the conclusion that new entertainment related projects acquired from Israel Theatres and the new, successful real estate projects of Cinema City have common ground and that we can achieve considerable synergies by placing them together under one entity. In addition the timing of this acquisition of the real estate assets provides good potential for growth and we believe it will be of significant benefit to Cinema City in the coming years." said Moshe J. Greidinger, CEO of Cinema City, the largest multiplex cinema operator in Central & Eastern Europe and in Israel. "We are financing this acquisition from our new, credit facility provided by leading European banks. This new credit facility has enabled Cinema City to refinance its existing bank debt and can open access to subsequent credits in the future." added Moshe J. Greidinger

The assets of SPC include: Mall of Russe and other plots of land in Bulgaria, plots of land designated to develop an amusement park in Poland and indirect interest of 32.11% in Ronson Europe NV and an office building in Herzliya and 5 other properties in Israel. Within the framework of closing of the agreement all shareholders loans of EUR 32.4 m granted by Cinema City will be settled. Upon completion of this transaction Israel Theatres Ltd, a parent company of Cinema City International NV will remain a holding entity with no operations and the Company will operate two business divisions: cinema operations and real estate operations.

The new credit facility of EUR 210 million includes EUR 70 million revolving credit. The term of credit is 6 years. Credit facilities may be used in EUR and PLN and will be secured mainly by pledges of shares in major Company's subsidiaries, investment certificates and mortgages on major real estate assets. The credit agreement provides for standard covenants including those relating to a pre-determined level of leverage (net leverage covenant) and margin. It also includes a change of control clause in case the Greidinger family holding in the Company decreases to below 30% or another investor obtains control over the Company.
The new club financing agreement will be used by the company to finance the acquisition price of EUR 33.1 million, to refinance all other Group credit facilities including the debt of SPC,  and for other general corporate purposes. The only other group financing that remains in place following the new club financing is a local Israeli financing of approx. EUR 40 million.

"Through the company history and mainly in the last 10 years CCI was led by its management through many moves which gained the company a reputation of knowing where and when to target it's future. This vision combined with strong decision making have brought us to this day where we face a new platform  with many opportunities to continue doing the best in developing the company in the huge entertainment field. This is an important step for us and I can only say how proud we are to be trusted by the leading banks in Europe, in days where obtaining credit in such levels is far from being a sure or easy thing" concluded Greidinger and added "The business now aligns the interests of all shareholders, and it is for us as management to continue growing Cinema City as one of the leading cinema operators in Europe" - concluded Moshe J. Greidinger

Cinema City International is the largest multiplex cinema operator in Central & Eastern Europe and in Israel. The Company operates 98 multiplexes with 952 screens, in 7 countries (Poland, the Czech Republic, Hungary, Romania, Bulgaria, Slovakia and Israel). There are 30 more multiplexes under development, which will offer almost 320 new screens. In addition, Cinema City is actively involved in cinema related advertising and film distribution.

The Cinema City group employs over 4,000 people in 7 countries.
Investor Relations
Cinema City International NV