SYDNEY, Australia (CNN) -- U.S. theater owner Regal Entertainment Group has agreed to buy 52 cinemas in the United States from Australia's Hoyts Cinemas Group for $200 million in cash and stock.
Hoyts is controlled by Australia's richest man, Kerry Packer, through his private company, Consolidated Press Holdings (CPH).
Packer's son James, who is joint chief executive of CPH, will join the Regal board.
Regal, controlled by U.S. billionaire Philip Anshutz, operates the largest theater circuit in the United States under its Regal Cinemas, United Artists Theaters and Edwards Theaters brands.
It has a total of 5,663 screens in 524 locations. The Hoyts deal will add 554 screens, mainly in the northeast U.S., and will give the group its first Boston presence.
Regal said the screens it was buying from Hoyts generated more than 80 percent of Hoyts' cash flow.
Hoyts keeping 45 cinemasHoyts will retain 45 cinemas. Before the Regal deal it had 97 cinemas in the U.S. with about 900 screens. Along with its payment of $100 million in cash and $100 million in stock, Regal will assume some capital leases.
Packer's CPH acquired the U.S. cinemas as part of its $480 million purchase of the Australian and New Zealand Hoyts cinema group in 1999.
It has been looking to sell the U.S. business, even though it has been profitable recently.
In Australia, shares in the Packer-backed investment trust, CPH Investment Corp, closed 2 percent lower Wednesday at A$0.48, compared with a decline of 0.95 percent for the broader Australian market, measured by the S&P/ASX200.
Packer's other listed entity, Publishing and Broadcasting Ltd (PBL), which controls the Nine television network, rose 0.24 percent to A$8.37.
Regal, which floated on the New York Stock Exchange last May after Anshutz earlier bought it out of Chapter 11 bankruptcy protection, reported Tuesday that its pro forma revenue for the 2002 year was $2.266 billion, a 12.6 percent increase over the previous year.
It said pro forma earnings before interest, tax, depreciation, amortization and merger and restructuring expenses rose 37 percent to $481.1 million.
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