Five years after entering the Saudi Arabian market—becoming one of the first companies to do so after the 2018 lifting of a decades-long ban on theatrical exhibition—AMC Theatres is stepping back from its theaters there, transitioning from a management and investment role in the Saudi Cinema Company (SCC) to a pure licensing relationship.
SCC was formed through a partnership between AMC Theatres—operating in the country as AMC Cinemas—and Saudi Entertainment Ventures (SEVEN), part of the country’s Public Investment Fund (PIF), in order to develop and operate cinemas across the country. The collaboration with SEVEN had yielded 13 cinemas to date, with others in the pipeline. As part of the agreement, SEVEN will buy-out AMC’s $30M investment in SCC, while current and future AMC locations operated by SCC will retain the AMC Cinemas name and other IP.
Commented AMC Chairman and CEO Adam Aron:
“When the joint venture was created, it had two goals. First, to bring moviegoing to the Saudi people. Second, and equally important, to train a theater management and corporate team such that at some point in the future, the enterprise could be run locally within the Kingdom. After more than five years since our first trip to Saudi Arabia and nearly five years since we opened our first theatre there, that point in the future is now. This announcement and agreement is the natural next step in this process. During the last five years we’ve opened 13 beautiful theaters, hired and trained so many Saudi nationals, endured a global pandemic, and, perhaps most importantly, helped bring movies to the Saudi people. In making this transition, we have enormous confidence in the team running these theaters and the venture is moving to the next stage exactly as we envisioned at the time we started. We look forward to continuing our relationship with SCC and the great people at SEVEN in bringing the AMC movie-going experience to Saudi audiences for years to come.”
Aron took to Twitter to share news of AMC’s new position in Saudi Arabia, noting that it had always been the company’s plan to transition those cinemas to local management. He adds that the $30M paid by SEVEN for AMC’s 10$ stake in SCC shores up the exhibitor’s cash reserves.