Australian cinema chain The Hoyts Group sold to China’s ID Leisure International

Australian private equity firm Pacific Equity Partners (PEP) today struck a deal to sell Australia's second-largest cinema chain The Hoyts Group to ID Leisure International Capital – an investment fund backed by Chinese billionaire Sun Xishuang.

PEP, Australia's largest private-equity firm, did not disclose the financial terms of the deal, but had valued the cinema chain last year at A$900 million while preparing an initial public offer.

''We look forward to the investment and development of Hoyts going forward under the ownership of a new investor, ID Leisure,'' said Hoyts' recently-appointed CEO, Damian Keogh.

''Hoyts is embarking on a number of exciting opportunities and together with ID Leisure, we will continue to invest in the exceptional customer experience currently offered to 20 million attendees annually,'' he added.

PEP, which acquired Hoyts in 2007 from Australian media tycoon Kerry Packer for $A440 million, had recently hired Swiss investment bank UBS to help run a dual-track sale or an IPO, but shelved a listing due to volatility in equity markets.

Hoyts is the region's second-largest cinema operator, with over 420 screens across 42 cinema complexes in Australia and 10 complexes in New Zealand. Most of these are multiplex cinema complexes are located within large shopping centres in urban locations.

Hoyts also offers home movies via Hoyts Kiosk, Australia's largest network of more than 600 movie rental machines located at supermarkets and other locations throughout Australia.

Hoyts also operates Val Morgan, the largest provider of cinema advertising in Australia and New Zealand, with approximately 95-per cent market share. Val Morgan owns the exclusive rights to sell pre-feature film cinema advertising on the screens of all major Australian and New Zealand exhibitors.

Val Morgan also offers a series of other advertising media products, including a network of over 2,300 digital advertising screens in high traffic malls and service stations.

British Virgin Islands-based ID Leisure is an investment vehicle owned by Chinese real estate billionaire Xishuang, the 18th richest realty businessman with a fortune of $2.41 billion.

Xishuang founded Yifang Group in Dalian in 2001, which operates in financial investment, city management, cultural tourism and realty. The company has total assets of over $4.88 billion and annual revenues of $1.95 billion.

He also holds a 6.3 per cent stake in China's Dalian Wanda Commercial Properties Co, which two years ago bought US-based AMC Theatres for $2.6 billion, and also holds a 4.2 per cent stake in Wanda Cinema Line.