Doughty divests Vue to Omers and Alberta for £935m

Doughty purchased Vue in November 2010 from management, Cavendish Square Partners and Och-Ziff Capital Management Group in a deal that valued the company at £450m.

Under Doughty's ownership Vue has doubled its number of cinemas from 70 to 146 and increased its number of screens from 678 to 1,321.

In May last year, Doughty supported Vue's acquisition of UK-based Apollo Cinemas. It then purchased CinemaxX in Germany in July 2012. More recently, the cinema operator acquired Multikino in Poland in May this year.

As well as increasing the cinema chain's international presence, Doughty has also supported Vue's roll out of new digital projection technology across its circuits, and opened new cinemas including Vue Westfield London and Vue Westfield Stratford City.

According to Mark Redman, senior managing director for Europe at Omers, the team had been following Vue closely since Doughty's 2010 investment. The pension fund was attracted to the space because of its solid growth over the last ten years. Omers was keen to invest in Vue because of further growth opportunities in the UK and the more fragmented market in Europe, as well as the ability to develop multiplexes and more 3D screens.

Debt for the deal was underwritten by Omers and AIMCo and options for financing are still undecided.

The acquisition of Vue represents yet another European secondary buyout for Omers, having previously bought Civica from 3i, Lifeways from August Equity and V. Ships from Exponent Private Equity. Redman countered criticisms concerning Omers' origination strategy by asserting that the fund is only interested in top quartile assets: "If the asset is owned by private equity it doesn't bother us, as long as there is more room for growth then we're happy."

Private equity has enjoyed a fruitful relationship with cinemas over the past decade, especially in the UK. Terra Firma owns Odeon, which it is reported to be looking to sell this year in a deal that could fetch up to £1bn. Last year Albion Ventures sold its stake in the Picturehouse chain to Cineworld for £12.5m. Furthermore, Blackstone still holds a 20% stake in Cineworld.

Despite sitting in the midst of the leisure sector, cinemas have proved resilient throughout the downturn as a night at the pictures offers consumers a contained cost, while the cinema operators themselves have benefited from cheaper operating costs thanks to developments in digital technology and 90% mark-ups on pop-corn.

Company
Established in May 2003, Vue currently operates multiplex cinemas across the UK, Ireland, Germany, Denmark, Portugal, Poland, Latvia, Lithuania and Taiwan.

People
The Vue management team, led by founder Tim Richards, will retain an equity stake and continue to manage the business.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Exits
• Consumer
• UK / Ireland
• DACH
• Southern Europe
• CEE
• Buyouts
• Doughty Hanson & Co
• Terra Firma
• Albion Ventures
• Secondary buyout