Vue Cinema up for Sale

vue

£440 million is quite a lot for a bunch of 2nd hand pop corn machines

The cinema chain that owns the Swan centre’s flagship cinema ‘Vue’ is trying to find a buyer for the company it has emerged.

The state of the art movie theatre opened in Eastleigh last year and reported an excellent start to trading.

Vue which operates 65 cinemas in the UK and has 20% of the market, is partly owned by LloydsTSB which is looking to reduce some of £260 billion of ‘toxic assets’ it acquired from HBOS in 2008 when it had to seek £37 billion of taxpayer support.

Vue are said to value the company at £440 million although they lease their premises and projection equipment .

Despite the recession the company experienced a good years trading due to interest in digital 3D movies, however it still has around £14 million debt. If no buyer can be found then CEO Timothy Richards will look at other options including refinancing.

The CEO is confident of future prospects saying there is tremendous potential for growth in digital 3D cinema.

However, in a separate but related development last week, both Comet and John Lewis announced that they have started selling 3D TV sets…..

  3 comments for “Vue Cinema up for Sale

  1. Matthew Myatt
    April 27, 2010 at 1:32 pm

    I hate to say it but.. I told you so.!!

  2. November 6, 2010 at 3:47 pm

    it looks like the writing’s on the wall for vue, eastleigh.in most people’s experience if a thing is losing money ,it is the norm to close it down. i hope this doesn’t happen with this cinema. my wife and i have seen many films there since it opened last year.the only critiscm i would have about it is the over priced food and drinks.they are ridiculously high.they should consider reducing them considerably.

  3. November 7, 2010 at 12:15 am

    it looks like the writing’s on the wall for vue, eastleigh.in most people’s experience if a thing is losing money ,it is the norm to close it down. i hope this doesn’t happen with this cinema. my wife and i have seen many films there since it opened last year.the only critiscm i would have about it is the over priced food and drinks.they are ridiculously high.they should consider reducing them considerably.  

    Mike,

    Let me let you into a little secret..

    Cinemas do not make money from showing films. The film distributor charges the cinema 96% return on every ticket sold, so the only way for cinemas to make money is from selling food and drinks. Its called a PPP or Pence Per Person. Every cinema manager has a PPP that he must hit each week to make the place work, in the case of Eastleigh Vue its about £5.76.

    So if less people go to the cinema the PPP goes up to cover costs. Making the prices lower would only mean less people getting more for their money and not more profit for the cinema.

    The Vue cinema is in a very difficult and risky position. EBC has given Vue a huge incentive to come to the town with massive discount on Ground Rents, Business Rates and some £200,000.00 in cash injections.

    These discounts are very soon about to stop and then Vue will be faced with having to pay the full going rate to be in the town.

    Now, they are not making enough money at this time with all the things they are not paying for, so the future is very uncertain for this cinema that other cinema operators looked at very carefully and decided NOT to come to Eastleigh.

    In the original plan for the cinema complex, which was announced in 1997, Odeon were going to be the operator. However they soon worked out that they could not make it pay and walked away, as did two other operators.

    Mr House and his puppets from EBC only managed to get Vue to come in after giving all sorts of deals to make it sweet for them. I fear this will be their epitaph and the people of Eastleigh’s loss.

    Still we will still have one other cinema left in the town when it closes. O yes, Eastleigh has two cinema’s. Whilst Mr House and his puppets were telling us all what a great job they had done bringing cinema back to the town, they had been pumping 1.6 million pounds of tax payers money equipping ‘The Point’ with what is now redundant 35mm film projection equipment and Dolby Digital Sound.

    Only problem now is this equipment, that we paid for, is useless as all cinemas now use HiDef Video Projection and not film. Ask for a tour of the projection area of the Vue in Eastleigh and you can see for yourself.

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