Cineplex names Bill Walker as CEO, initiates review that could include company’s sale

Cineplex Inc. CGX-T has named a new chief executive officer and launched a strategic review that could involve a sale of the company.

Canada’s largest movie-theatre chain announced on Wednesday that Bill Walker, who previously led competitor Landmark Cinemas, will take over as CEO, effective immediately.

Cineplex has faced questions about its succession plans for more than a year, since Ellis Jacob announced last June that he would retire after more than two decades at the helm of the company. Mr. Jacob will remain as a special adviser to the board of directors until the end of this year.

Mr. Walker will oversee the dominant player in Canada’s movie-theatre industry, as Cineplex considers its future. The board’s strategic review “will consider a range of alternatives, including, but not limited to, a potential sale of the company,” the company said in a press release on Wednesday morning.

“Cineplex has a strong market position, a portfolio of leading entertainment assets, powerful consumer brands, and attractive long-term growth opportunities. However, we believe the Company’s current market valuation may not fully reflect the strength of its business and long-term prospects,” board chair Phyllis Yaffe said in the release. “While we remain highly confident in the Company’s future prospects, we are committed to evaluating all available opportunities and remain open-minded regarding potential outcomes.”

It is not the first time Cineplex has been on the market. In 2019, Cineworld reached a $2.2-billion deal to acquire the company, before pulling out of the agreement months later as the pandemic shocked the industry.

There has been chatter about Cineplex considering a sale in recent months. In April, Bloomberg reported that the company had been in touch with industry peers, such as Cinemark Holdings Inc. and Regal Cineworld Group, to gauge interest in a potential deal.

“Six years ago, when I sold the company, I believed that consolidation was important because studios were consolidating, and exhibitors had to look at the same opportunities,” Mr. Jacob said in an interview with The Globe and Mail in May. “But you can only do it when you’re in a stronger position, and that’s what we are working towards − and others in the business are doing the same thing.”