The Australian Competition and Consumer Commission has given its blessing to national cinema giant Hoyts’ planned purchase of rival Greater Union’s 45 per cent interest in the Cinema City joint venture.
This follows the ACCC’s decision not to oppose cinema transactions between Hoyts and Greater Union, which have several joint venture arrangements.
The ACCC announcement also anticipates the closure of the other Perth cinema subject to the existing joint venture, the three-screen Cinecentre.
The various joint venture arrangements were entered into between 1998 and 2001 and also include arrangements with cinemas in Sydney and Brisbane.
ACCC chairman Graeme Samuel said the competition regulator considered the transactions would not substantially lessen competition for first-release film exhibitions in Perth, Sydney or Brisbane.
“The ACCC considered that competition from other suburban and CBD cinema operators would constrain Greater Union and Hoyts from increasing ticket prices,” he said.
In Sydney, Hoyts will acquire Greater Union’s 50 per cent interest in the Broadway Cinema joint venture, while Greater Union will acquire Hoyts’ interest at the George Street cinema joint venture.
In Brisbane, Greater Union will acquire Hoyts’ interest in seven screens at the Myer and Regent cinema complexes.
In 2004, developer Westpoint proposed a 27-storey building on the Cinema City site, which would include 136 apartments and a 204-room hotel.
The proposal was knocked back due to height problems and shadowing on one of the state’s premier heritage precincts.
Cinema City and the Cinema City Arcade are owned by Goldtag Pty Ltd, which is part of the Westpoint group.
The Cinecentre Arcade building, including the three cinemas, is owned by Gutace Holdings Pty Ltd, part of the Greater Union group.
Hoyts is co-owned by Kerry Packer’s Publishing & Broadcasting and West Australian Newspapers Holdings Ltd while Greater Union is part owned by Amalgamated Holdings Ltd.
