Cineplex Inc. has signed a definitive agreement to sell its digital place-based media division, Cineplex Digital Media (CDM), to U.S.-based Creative Realities Inc. (CRI) for $70 million in cash.
In a recent press release, the company said the transaction is expected to close in the coming weeks, pending regulatory approvals and other customary closing conditions.
CRI will acquire all issued and outstanding common shares of CDM. Cineplex said the sale will strengthen its balance sheet and provide capital for share buybacks, debt reduction, and general corporate purposes, subject to restrictions under its current debt agreements.
“The strength of the offer, followed by a thorough diligence process, positioned Cineplex to capitalize on a timely opportunity to divest and unlock meaningful value,” the company stated.
Cineplex also announced it will continue as the exclusive advertising sales agent for CDM-operated digital-out-of-home networks across Canada under a long-term agreement included in the deal.
“Over the past 16 years, Cineplex Digital Media has grown to be an industry leading and award-winning digital solutions company, operating some of the largest digital networks across North America,” said Ellis Jacob, president and CEO of Cineplex.
“As we continued to grow CDM, we had said we would remain open to an opportunistic and strategic sale. CRI’s strong offer and this accretive transaction will provide us with meaningful capital to continue to deliver value for our shareholders.”
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