Consolidated Theatres selling to mainland firm
STORY SUMMARY »
Consolidated Theatres, a Hawaii movie operator founded in 1917, is being sold to a California-based cinema operator and real estate company as part of a larger acquisition totaling $72 million.
Consolidated's owner, Pacific Theatres Exhibition Corp., is selling its interest in nine Hawaii theaters on Oahu and Maui, plus six others in California, to Reading International Inc.
Consolidated officials would not comment on the deal, which is expected to be completed by year's end, the companies said.
It is unclear whether the new owners will keep Consolidated's name and management.
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STAR-BULLETIN / 2003
The Ward 16 Theatres on Auahi Street has been a flagship property for Consolidated Theatres.
The parent company of Consolidated Theatres has agreed to sell the venerable Hawaii chain along with other cinemas across the country for $72 million.
Consolidated owner Pacific Theatres Exhibition Corp. is selling its leasehold interests in nine Hawaii theaters on Oahu and Maui, as well as six others in California, to Reading International Inc., a California-based cinema operator and real estate company.
The California theaters being sold are in Rohnert Park, Bakersfield and San Diego, according to a source familiar with the deal who asked not to be identified.
"Pacific Theatres has been pursuing the sale of its theaters located outside the greater Los Angeles area," said Jody Shiroma, Consolidated spokeswoman. However, Shiroma wouldn't comment further on the deal, which is expected to be completed by year's end, according to a statement issued by the companies.
It is unclear whether the Hawaii theaters will keep Consolidated's name and management once they are sold to Reading International.
The 15 theaters, which contain 181 screens with annual revenue of approximately $81 million, will be acquired by a wholly-owned subsidiary of Reading International with a combination of debt financing through GE Capital Corp. and seller financing, the statement said.
The sale is contingent upon Reading International's ability to acquire the financing. The company has agreed to pay Pacific Theatres an undisclosed termination fee if the sale falls through, according to the release.
Pacific Theatres owns the leasehold interests in all of its Hawaii operations. It sold its last fee-simple holding, the Varsity Twin Cinema site, in June to Kamehameha Schools.
Pacific Theatres, which operates a total of 98 screens in the islands, has been trying to sell its Hawaii movie exhibition business since 2003, when it operated 109 screens in the islands.
The company once enjoyed a monopoly in Hawaii, but decided to close its older theaters, such as its Waikiki locations, to convert them into retail and restaurant developments.
The company operates seven multiplex theaters on Oahu: the Ward Cinemas, Mililani, Pearlridge West, Kapolei, Kahala, Koolau Stadium and Koko Marina. It also operates the Kaahumanu and Kukui Mall movie houses on Maui.
Consolidated, founded in 1917, quietly shut down its last double-screen theater -- the Aikahi Twin in Kailua -- in August, following the June closure of the nostalgic Varsity Twin Cinema on University Avenue.
Scott Brazwell, Consolidated's vice president of operations, has said the decision to close the unprofitable double-screen movie theaters was based on years of declining attendance.
The Consolidated movie deal
What: Consolidated Theatres, with nine theaters in Hawaii, plus six theaters in California
Seller: Pacific Theatres Exhibition Corp., Los Angeles-based operator of theaters and entertainment business in California and Hawaii
Buyer: Reading International Inc., Los Angeles-based operator of theaters and retail centers in the United States, Australia and New Zealand
Price: $72 million
Completion: End of 2007