Virgin in race to get MGM cinemas

Virgin cinemas may soon join condoms, pension plans and cola in Richard Branson's empire if his £150m bid for MGM, Britain's biggest cinema chain, is accepted.

Advisers to French bank Crdit Lyonnais will decide on a short-list of bidders this week after receiving over 30 offers from around the world.

Mr Branson's dream of repeating his Virgin Megastores success will depend on beating off tough competition from the likes of Michael Green's Carlton Communications and Sony, Japan's electronics and entertainment giant. Mr Green has secured the backing of Goldman Sachs and Polygram, the US entertainment group.

A Virgin spokesman said: "It's extremely exciting. We can bring in our retail skills and our brand name, as we did with the Megastores. We have already launched a number of music and video stores in a joint venture with the Gaumont cinema chain in France."

The MGM name reverts to the US parent company when the cinemas are sold. Rank is also bidding, but may run into regulatory problems from the Monopolies and Mergers Commission because it already owns the UK's second-biggest chain, Odeon.

The Virgin project was suggested to Mr Branson several weeks ago by Luke Johnson and Hugh Osmond, well-known in the City for their entrepreneurial flotations such as PizzaExpress and the printer Bath Press. They have recently been linked to a consortium seeking to buy Wembley stadium.

Mr Johnson and Mr Osmond have banker Hill Samuel and stockbroker Panmure Gordon lined up to arrange a listing for the MGM chain if successful.

Credit Lyonnais has appointed SG Warburg to sell the MGM chain, which has 416 screens on 120 sites in the UK. It also has another 30 sites in the Netherlands and Denmark. Sources said yesterday that different bidders were going for different bits of the chain. The Virgin bid is for the UK cinemas only and does not include the UK head office. Many of the UK sites are freehold, making them ripe for development.

A SG Warburg spokesman said yesterday: "There has been an incredible response from companies all over the world. We have had indicative offers and we are now putting together a shortlist. The sale is well on schedule for the summer."

It is understood most bids have been around £150m mark, and the highest about £160m.

Film industry commentators have suggested that the recent highly colourful history of the MGM cinema chain would make a jolly good film. The original owners ABC sold it to Thorn EMI, who then sold it on to Australian tycoon Alan Bond in 1986. Mr Bond's business empire bit the dust after a sustained assault from Tiny Rowland. Ownership then passed to Cannon, an independent company run by two Israeli businessmen Menahem Golan and Yoram Globus.

The Israelis ran into financial difficulties of their own at the end of the 1980s, and sold the MGM chain to an Italian businessman Giancarlo Paretti. Crdit Lyonnais backed him to buy MGM's Hollywood studios for $1.3bn (£867m), and when he went bust last year the bank seized the cinema chain in lieu of its loans.

Crdit Lyonnais would like a quick sale, since it is now at the centre of one of France's worst banking crises. City commentators have dubbed the Lyonnais saga a disaster "five times the size of Barings".

Suggested Topics
Sport
world cup 2014A history of the third-place play-offs
News
Tommy Ramone performing at The Old Waldorf Nightclub in 1978 in San Francisco, California.
peopleDrummer Tommy was last surviving member of seminal band
Life and Style
Swimsuit, £245, by Agent Provocateur
fashion

Diving in at the deep end is no excuse for shirking the style stakes

Sport
The Mexico chief finally lets rip as his emotions get the better of him
world cup 2014
PROMOTED VIDEO
Voices
Spectators photograph the Tour de France riders as they make their way through the Yorkshire countryside
voicesHoward Jacobson: Line the streets for a cycling race? You might just as well watch a swarm of wasps
Life and Style
lifeHere's one answer to an inquisitive Reddit user's question
Life and Style
Several male celebrities have confessed to being on a diet, including, from left to right, Hugh Grant, Benedict Cumberbatch and Ryan Reynolds
...and the weight loss industry is rubbing its hands in glee
News
peopleDave Legeno, the actor who played werewolf Fenrir Greyback in the Harry Potter films, has died
Arts and Entertainment
'Eminem's recovery from substance abuse has made him a more potent performer, with physical charisma and energy he never had before'
arts + entsReview: Wembley Stadium ***
Sport
Mario Balotelli, Divock Origi, Loic Remy, Wilfried Bony and Karim Benzema
transfersBony, Benzema and the other transfer targets
Sport
Yaya Touré has defended his posturing over his future at Manchester City
News
Detail of the dress made entirely of loom bands
news
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Life and Style
beauty
Sport
There were mass celebrations across Argentina as the country's national team reached their first World Cup final for 24 years
transfersOne of the men to suffer cardiac arrest was 16 years old
Arts and Entertainment
Armando Iannucci, the creator of 'The Thick of It' says he has
tvArmando Iannucci to concentrate on US show Veep
News
A mugshot of Ian Watkins released by South Wales Police following his guilty pleas
peopleBandmates open up about abuse
Sport
Basketball superstar LeBron James gets into his stride for the Cleveland Cavaliers
sportNBA superstar announces decision to return to Cleveland Cavaliers
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Information Security Manager (ISO 27001, Accreditation, ITIL)

£70000 per annum: Harrington Starr: Information Security Manager (ISO 27001, A...

Biztalk - outstanding opportunity

£75000 - £85000 per annum + ex bens: Deerfoot IT Resources Limited: Biztalk Te...

Trade Desk Specialist (FIX, Linux, Windows, Network Security)

£60000 per annum: Harrington Starr: Trade Desk Specialist (FIX, Linux, Windows...

Service Desk Analyst (Windows, Active Directory, ITIL, Reuter)

£35000 per annum: Harrington Starr: Service Desk Analyst (Windows, Active Dire...

Day In a Page

A History of the First World War in 100 Moments: Peace without magnanimity - the summit in a railway siding that ended the fighting

A History of the First World War in 100 Moments

Peace without magnanimity - the summit in a railway siding that ended the fighting
Scottish independence: How the Commonwealth Games could swing the vote

Scottish independence: How the Commonwealth Games could swing the vote

In the final part of our series, Chris Green arrives in Glasgow - a host city struggling to keep the politics out of its celebration of sport
Out in the cold: A writer spends a night on the streets and hears the stories of the homeless

A writer spends a night on the streets

Rough sleepers - the homeless, the destitute and the drunk - exist in every city. Will Nicoll meets those whose luck has run out
Striking new stations, high-speed links and (whisper it) better services - the UK's railways are entering a new golden age

UK's railways are entering a new golden age

New stations are opening across the country and our railways appear to be entering an era not seen in Britain since the early 1950s
Conchita Wurst becomes a 'bride' on the Paris catwalk - and proves there is life after Eurovision

Conchita becomes a 'bride' on Paris catwalk

Alexander Fury salutes the Eurovision Song Contest winner's latest triumph
Pétanque World Championship in Marseilles hit by

Pétanque 'world cup' hit by death threats

This year's most acrimonious sporting event took place in France, not Brazil. How did pétanque get so passionate?
Whelks are healthy, versatile and sustainable - so why did we stop eating them in the UK?

Why did we stop eating whelks?

Whelks were the Victorian equivalent of the donor kebab and our stocks are abundant. So why do we now export them all to the Far East?
10 best women's sunglasses

In the shade: 10 best women's sunglasses

From luxury bespoke eyewear to fun festival sunnies, we round up the shades to be seen in this summer
Germany vs Argentina World Cup 2014: Lionel Messi? Javier Mascherano is key for Argentina...

World Cup final: Messi? Mascherano is key for Argentina...

No 10 is always centre of attention but Barça team-mate is just as crucial to finalists’ hopes
Siobhan-Marie O’Connor: Swimmer knows she needs Glasgow joy on road to Rio

Siobhan-Marie O’Connor: Swimmer needs Glasgow joy on road to Rio

18-year-old says this month’s Commonwealth Games are a key staging post in her career before time slips away
The true Gaza back-story that the Israelis aren’t telling this week

The true Gaza back-story that the Israelis aren’t telling this week

A future Palestine state will have no borders and be an enclave within Israel, surrounded on all sides by Israeli-held territory, says Robert Fisk
A History of the First World War in 100 Moments: The German people demand an end to the fighting

A History of the First World War in 100 Moments

The German people demand an end to the fighting
New play by Oscar Wilde's grandson reveals what the Irish wit said at his trials

New play reveals what Oscar Wilde said at trials

For a century, what Wilde actually said at his trials was a mystery. But the recent discovery of shorthand notes changed that. Now his grandson Merlin Holland has turned them into a play
Can scientists save the world's sea life from

Can scientists save our sea life?

By the end of the century, the only living things left in our oceans could be plankton and jellyfish. Alex Renton meets the scientists who are trying to turn the tide
Richard III, Trafalgar Studios, review: Martin Freeman gives highly intelligent performance

Richard III review

Martin Freeman’s psychotic monarch is big on mockery but wanting in malice