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Cinema JV called off

By Phil Boeyen, ShareChat Business News Editor

Thursday 7th September 2000

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Force Corporation and Village Roadshow are unwinding their joint venture with Hoyts Cinemas but say they will retain their shared interests in an Auckland multiplex.

The companies have decided it would be in the best interests of their shareholders not to have any operating alliance, other than the Queen Street multiplex within the Force Entertainment Centre, subject to the approval of the New Zealand Overseas Investment Commission

The merger partners say they believe the joint venture could be supported under current law, but claim the management time and costs involved in a protracted legal battle with the Commerce Commission would negate any benefits.

The Commerce Commission started court action to stop the proposed merger of the Hoyts and Village Force cinema chains last August. It said at the time it was concerned about its impact on competition in New Zealand markets for film distribution and screening. A hearing on the court action is expected to take place within a few weeks.

The cinema operators says the unwinding of the joint venture and any final resolution of the proceedings issued by the Commerce Commission are not expected to have a material impact on their financial statements.

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