AMC Theatres Eyes $2B-Plus London IPO for Odeon Unit (Report)

CEO Adam Aron had in November signaled the company could go for a stock market listing of its European operation.

Exhibition giant AMC Theatres has started work on a potential London stock market listing of Odeon, the Britain-based European cinema chain it owns, Reuters reported Thursday, citing sources familiar with the matter.

Citi is working on an initial public offering with AMC of Odeon, which also includes Scandinavian exhibitor Nordic Cinema, which the company bought last year, with the stock market listing possibly coming by mid-2019, according to the report. It said it could value Odeon at more than $2 billion.

AMC CEO Adam Aron had in November signaled the company could go for an IPO in London, saying on an earnings conference call: "It has not escaped our notice that even though European public markets value movie theaters at double-digit EBITDA (earnings before tax, interest, depreciation and amortization) multiples, we are not seeing such valuations for our European assets at these levels when they are buried within AMC."

AMC is controlled by China’s Dalian Wanda Group. AMC could use the proceeds from a London IPO to reduce its debt leverage or return cash to shareholders, including Wanda, which has been in selling mode since Chinese regulators upped their scrutiny of its heavy debt load and potentially risky bets overseas.

Wanda declined to comment. AMC and Odeon representatives couldn't immediately be reached for comment.