Cineplex Galaxy Income Fund Acquires Famous Players Business

On July 22, 2005, Cineplex Galaxy Income Fund completed the acquisition of the Famous Player movie exhibition business of Viacom Inc. for $500 million, including the assumption of capital leases. Following the acquisition of Famous Players, Cineplex Galaxy is Canada's largest movie exhibition business.

Prior to completing the transaction with Viacom, Cineplex Galaxy entered into a consent agreement with Canada's Commissioner of Competition, which requires the sale of 34 theatres following the completion of the acquisition.

The transaction was funded in part from the proceeds of a $215 million public offering of units and 6 per cent convertible extendible unsecured subordinated debentures through a syndicate of underwriters led by RBC Capital Markets, Scotia Capital and National Bank Financial and from the proceeds of a $425 million credit facility entered into with a syndicate of lenders led by Scotia Capital, RBC Capital Markets and National Bank Financial.

Cineplex Galaxy was represented by Goodmans LLP in connection with the M&A transaction, the public offering and the lending transaction, under the direction of Anne Fitzgerald, vice-president and legal counsel of Cineplex Galaxy, and Andrea Daly, general counsel of Onex Corp., which indirectly controls Cineplex Galaxy. The Goodmans team included Tim Heeney, Dan Gormley, Meredith Roth and Shevaun McGrath (corporate/ securities), Mitch Sherman and Carrie Smit (tax), Jeffrey Citron and Cicely Leemhuis (banking), Tom Macdonald and Ken Herlin (real estate) and Jana Steele (pensions).

Davies Ward Phillips & Vineberg LLP represented Cineplex Galaxy with respect to competition matters relating to the acquisition of Famous Players. The Davies team included George Addy, Richard Elliott, Christopher Margison, Lori Cornwall and Elisa Kearney.

Viacom was represented by Osler, Hoskin & Harcourt LLP, under the direction of Sipi Bhandari, vice-president and senior counsel at Viacom in New York. The Osler team included Stephen Sigurdson, David Pathe, David Hanick and Andrew Moshoian (corporate), Peter Franklyn and Janet Bolton (competition), Paul Morassutti and Jack Cook (real estate), Jason Hanson and Kari Abrams (labour and employment) and Paul Litner and Deron Waldock (pensions and benefits). Jeffrey Trossman and Allan Gelkopf of Blake, Cassels & Graydon LLP acted for Viacom in connection with tax matters.

The underwriters for the public offering were represented by Torys LLP with a team that included Matthew Cockburn, John Emanoilidis and Andrew Prodanyk, Alfred Avanessy, Stephen Johnson and Cynthia Sargeant (corporate/ securities); Jim Welkoff and Richard Johnson (tax); Dennis Mahony and Michael Fortier (environmental); and Christina Medland and Valerie Arthur (pension and employment).

The syndicate of banks was represented by Borden Ladner Gervais LLP with a team that included Bruce Fowler, Gus Karantzoulis and Terence Lui (banking), Lee Woods (real estate), Adam Fanaki (competition), Ziad Katul (IP) in the Toronto office, and Pierre Côté and Claudine Millette (banking) in Montreal.