1 Sep – Despite trying its best to save the cineplexes, mm2 Asia revealed that it has now finalised terms of the sale of its cinema business.
In an agreement signed on 30 August, mm2 Asia will sell at least 80 percent of its chain of cinemas including Cathay Cineplexes to investor Jasmine Foo Mei Ling via Kingsmead Properties.
The unit is now valued at SGD 84.8 million with mm2 receiving SGD 67.3 million net, after costs. It is noted that the company paid SGD 230 million when it acquired the Cathay Cineplexes in November 2017.
The proceeds will be used to repay convertible bonds and support the company's balance sheet.
"The cinema business has been a strategic part of the group's content creation and distribution business, but it has been affected by Covid-19," says executive chairman Melvin Ang. "With this proposed sale, it will stabilise the group's financial situation and allow mm2 to continue to focus on the development and strengthening of core production content growing opportunities."
It is noted that the Singapore cinema chain lost SGD 66.8 million in the financial year ending March 2021.
Earlier last month, mm2 Asia stated that it will try to look at spin-off IPO of Cathay Cineplexes, despite also signing with Kingsmead - stating that they will be able to convert its deposit of SGD 3 million into shares of the unit at a discounted price if they succeeded.