14 June 2010
Olswang represented Cineworld Group plc, the UK’s only quoted cinema chain, in a deal that will mean all of its 77 cinema sites will be fully converted to digital within three years. Partnering with Arts Alliance Media, a leading European provider of digital cinema technology and distribution services, the estimated cost of conversion for Cineworld is approximately £30m, in addition to the £10m already spent in 2009 and the first half of 2010.
The full digital rollout will allow Cineworld to continue to show the latest 3D films on more screens; offer customers an increased range of alternative entertainment, including live sport, live opera, theatre, comedy and gaming; as well as capitalise on other venue uses, such as training and conferences.
Fabrizio Carpanini, Partner, Olswang said: "Cineworld has been one of our valued clients over the past few years and we were very pleased to be instructed to advise on this hugely important deal for them. It involved a complex and innovative financial structuring across several jurisdictions".
Under the agreement, Cineworld will buy, install and operate digital projectors across the remainder of its cinema chain. The total cost to Cineworld will be recouped through the ‘VPF’ (Virtual Print Fee), which Arts Alliance Media will collect from film distributors on behalf of Cineworld. Cineworld expects that over a 7-10 year period, this arrangement will refund 90% of the £40m total conversion cost.
