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80pence today. easy.
My goodness me, another substantial rise :D
Quickly scooped by a few more shares at 74.9, no clue when we will see a pullback (if any at all) so best to buy now whilst I still can :)
All imo, let’s get 80p sp in this week hopefully
Yes I agree with exciting times, let's see how it pans out today but I'm looking forward to it.
I'll take £3 any day lol.
I started off with a double bagger in mind then went on to the £1.50/£1.80 now I'm revising again.
Looks like we have quite a few things going the right way for Cine.
Court case is in our favour too IMO
What an interesting thread this was lastnight! Exciting times ahead either way. I rather have £3 a share though haha.
Netflix are so large and under pressure to keep growing, they will pay what they need to pay.
What we are about to possibly witness is the next step to support cinemas for the future. It is setting up goliath to see what extra revenues they can potential generate going to movies first. This is going to be exciting to watch. If it works I wouldnt be suprised to see cinemas taken over by Netflix, Disney, Amazon.
I'm watching, popcorn ready.
Good evening plumber95, cineworld was trading at 300p comfortably before they announced the cineplex acquisition. Now that cineplex is no longer happening, plus the cost saving measures, I personally think we are worth at least that 300p/share.
Of course, it’s quite a subjective thing.
I’d bite your hand off for 200p a share
Absolutely sharefall, 200p acquisition would be like buying Apple back when it was $10/share.
It is what it is, I don’t think any of us here hold so many shares to swing the decision so we can only watch and see what would unfold. Either way, at 200p I think you can expect to see me protesting outside of cineworld head offices at the price lol
Mountainous, I don't think we disagree about 200p being a very good deal for netflix. Just feel cine is vulnerable to a bid in that region. I'm hoping it will set off a bidding war with Disney and that would make things much more interesting. Atb
Of course sharefall, if Mooky and Jangho go through with £3bn and if another large shareholder like Cinema City also approve then the deal is done. I would get a payout in the several thousands if we get acquired for 200p/share so I definitely can’t complain about that, but I would find it a big shame that Netflix (or anyone for that matter) scooped up what would be the literal deal of the century for dirt cheap like that imo.
My last post was an extension of my previous one. Cineplex EBITDA in 2019 was 407m, so you see the premium that cineworld is paying for there.
Responding to sharefall’s post and another small extension, I think if Netflix wants to acquire us they need to bring a very high offer forward. They’re worth $260bn. If they offer £3bn for this company and if it goes through I think it will be a smack in the face to every investor and every executive that has had their pay cut and have implemented so many cost-saving measures too. We are in line for a much better profit margin in the next 1-2 years, and we would be handing it to Netflix on a gold platter for peanuts in return.
Let's just say as a shareholder I would not be objecting to a 10 B takeover!
Can't see it working that way though in the current situation.
Between Mooky and Jhango they own about 35% of the company so a deal to go through will only need their blessing to stand a good chance. Mooky will take a sweetener and Jhango have a low average. I don't think it will be that hard to get a sale through St about 200, providing Mooky is on board.
When a company acquired another company, they pay a premium with the expectation of future growth.
For example, when Cineworld sought to acquire Cineplex for $2.8bn, cineplex was bringing in $2.8bn approximately every 2 years, so cineworld sought to acquire with the expectation that cineplex’s revenue would continue to grow YoY. That is why in the RNS regarding the acquisition cineworld wrote that that deal has an EBITDA multiple of 6.3x, they are paying a premium for expected growth.
Similarly here, we had an EBITDA of 1.46bn in 2019, so if we have an EBITDA multiple of about 6.3x just like what happened with cineplex, then we are seeing close to £10bn in the market value of the proposed acquisition.
Call me crazy, but if you want to acquire a company you need to pay a good premium on it, at the end of the day it’s a risk you take when you acquire a company…
Hi Mountainous, your points are all very valid of course. The reality is cine is much weaker now than 2 years ago. I feel a compromise will involve Mooky retaining a significant role and authority which would suit netflix as they do not have the pedigree of running a cinema chain.
There is also of course Disney in this equation so I'm not discounting a bidding war!
Entirely possible I'm talking rubbish after one too many, so please all make your own mind up or better still hold and see....atb
Also with regard to the 3rd point, I have made a large error in saying they would pay £800m for the company. Of course not as they would pay a premium on the sp for it.
Apologies, I’m a bit sick at the moment so bear with me. At 200p sp, the value of the acquisition would be about £2.6bn, which as sharefall has pointed out equates to the same value just for Regal. I still believe that the price of 200p per share remains undervalued. Regal is 70% of the revenue, at 200p you are leaving out 30% of the remaining revenue income.
So unless if Netflix pay more than that (by a considerable amount imo) I still see it as a massively undervalued deal that the board wouldn’t take, and institutional investors wouldn’t look at favourably either unless if cineworld goes through some more big problems down the road again.
Small rectification, bombdog has informed me that the executives would get full bonus if an acquisition happens, so please take the first point out of consideration.
With that in mind, I’d also like to include that Mooky has a massive average price in his combined holding with his brother. They held shares at the time of the rights issue back in 2017, where we had a 600p sp approx, so the avg price is high even if they took the rights on their own holding as well.
To sell the company at this price would mean that Mooky would make a loss in his holding. What a big shame that would be. Imagine holding 30% of the company’s equity as an investment and you make a loss on it, that wouldn’t be good at all. After all the years that Mooky has held as well?
Hello sharefall, personally I don’t see it happening because:
1. Mooky has a bonus waiting for him at 180p and 360p approx, so unless if Netflix offers that I don’t think he will even bring it to a vote for shareholders. And I don’t see Netflix offering pre-covid price when we have added another c. 900m in debt since, so I don’t see the 2 sides compromising there.
2. Mooky loves being at the head of the company, and he is very good at it too imo. He has years and years of experience, as does his brother and the CFO. To sell to Netflix would mean that the executive team could get restructured, and I don’t think Mooky would want to run that risk at all. A lot of American companies have very money-hungry CEO’s and directors, and Mooky isn’t one of them. He genuinely cares for the business, and doesn’t use it for his own personal gain.
3. If Netflix purchase us now, they are getting the bargain of the century. That is £800m for a company that paid £2.4bn for just one segment of their business. I think any institutional investor with sense wouldn’t dare to allow that acquisition to go through. Once again, I don’t even think the board would allow the acquisition to even see the light of day, as they probably wouldn’t even allow a shareholder vote with how undervalued that deal is. It is robbery in broad daylight. Netflix would be laughing to the bank, they would make back the money they used to buy the entire company in just a year, considering we made approx £730m in profit in 2019 alone.
That is my 2 cents on the matter :)
It makes for a logical acquisition. Netflix has deep pockets and would be able to buy all of cine for the price it wanted to buy regal alone. It would still be at a premium to current SP. IMO we are seeing the beginning of this courtship.