Theater Operators To Form Giant Chain

Three rival movie-theater owners are joining together to create the world’s largest cinema company, with nearly twice as many screens as its closest competitor.

Two of Wall Street’s biggest buyout firms said Tuesday they will jointly purchase Regal Cinemas Cos., one of the nation’s fastest-growing theater chains, for more than $1.2 billion and then combine it with their newly acquired cinema businesses.

Regal chairman and chief executive Michael Campbell, a former grocer who started the company in 1989, will head the $3 billion new company. It will have 5,347 screens in 35 states - or nearly 18 percent of all U.S. screens.

Regal will be combined with Act III Cinemas, which was acquired by Dallas-based Hicks, Muse, Tate & Furst Inc., and United Artists Theatre Group, purchased by New York-based Kohlberg Kravis Roberts & Co.

Analysts said the combined company should have considerable might in determining everything from movie rights to the price they pay for popcorn.

“It is definitely the big gorilla in the industry,” said Gordon Hodge of Montgomery Securities in San Francisco.