Regal Entertainment execs out as Cineworld merger becomes final Wednesday

Top executives at Regal Entertainment Group, including CEO Amy Miles, are out of their jobs as the Knoxville-based theater chain officially becomes a subsidiary of its new European owner.

Regal's purchase by UK-based Cineworld Group PLC closed Wednesday.

Miles resigned as part of the deal, as did Greg Dunn, Regal's president and chief operating officer; Peter Brandow, Regal's general counsel; David Ownby, Regal's chief financial officer and treasurer; and Michael Campbell, Regal's founder and chairman emeritus.

► More: Regal's deal with Cineworld: What's it mean for Knoxville?

New execs named; shares yanked

Nisan Cohen, Cineworld's deputy CFO, will take Miles' place at the top of Regal, and Vincent Fusco, Cineworld's CFO, will become senior vice president, CFO and treasurer at Regal.

Miles, Dunn and a Regal spokesman didn't immediately respond to calls and emails.

Regal shares will be delisted from the New York Stock Exchange, as the company is now private. Stockholders will receive $23 per share.

All members of Regal's board of directors also quit under the terms of the deal. Out are:

Thomas D. Bell Jr.

Charles E. Brymer

Stephen A. Kaplan

David H. Keyte

Lee M. Thomas

Jack Tyrell

Alex Yemenidjian

Purchased in December

Cineworld reached the deal in December to purchase Regal for $3.6 billion.

Regal saw a decline in its third-quarter revenues over 2017. Total revenues for the period ending Sept. 30 were $716 million, compared to $811 million in 2016.

Regal shares slumped 21 percent, while the top movie chain, AMC Entertainment Holdings, fell 58 percent, according to Bloomberg News.

► More: Regal had been looking for buyer long before Cineworld came along

Regal also announced last year the company would begin testing demand-based pricing for films with the app-maker Atom Tickets LLC in hopes of boosting revenues.

"We are excited to have Regal join the Cineworld Group and proud to be a part of the Knoxville community," Mooky Greidinger, CEO of Cineworld Group, said in an emailed statement.

The future for South Knoxville

It's not clear what the merger will mean for Regal's deal with the city of Knoxville for its new corporate headquarters on the South Waterfront. The city helped put together a $12.5 million incentive package for the company, under which Regal would lease the building from the city for 10 years with two 10-year extension options. According to the contract, Regal pays no rent the first 10 years, then rent of $178,000 a year through years 11-20 and $356,000 a year for years 21-30 if Regal opts to activate those years.

The contract also included payment in lieu of taxes of roughly $45,000 the first year.

According to the contract, if Regal fails to employ 275 full-time workers or if the building ceases to be the company's headquarters, the rent goes up to $1.78 million a year for the first ten years, $1.95 million a year for years 11-20 and $2.13 million a year for years 21-30.

The city can terminate the lease if the company no longer uses the building as its headquarters for six consecutive months or fails to employ 275 full-time employees for six consecutive months. The terms of the contract apply even with the merger.

Even still, the city would rather not be having conversations about the linchpin of the South Waterfront development so soon into deal and before much of the rest of the development along the river has finished construction.

City hopes headquarters stays in Knoxville

Bill Lyons, chief policy officer and deputy to Mayor Madeline Rogero, said the city is unaware of any “forthcoming personnel changes" from Regal.

“Obviously, we’re very hopeful that the North American headquarters will stay in Knoxville. That was always the intent,” he said. “Anytime you have a change like this it gets our attention, but right now we anticipate changes will come, but they will keep within our (contractual) benchmarks."

“I would say Regal’s presence is just very important and a giant plus,” he continued. “We obviously have a lot of investment there in energy and they’ve had a lot invested there over the years. We of course hope they stay and continue that relationship with Cineworld. It’s very important.”