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Share 2016-09-29 17:07 RATOS B 40.51 SEK

NCG – creation of the leading cinema operator in the Nordic region

In April 2015, Ratos sold its holding in Nordic Cinema Group (NCG), providing an exit gain of SEK 905m and an IRR of 41%.

In just a few years, Ratos had executed what it set out to do when it purchased the local Finnish and Baltic cinema operator Finnkino in 2011 – to become a leading player in the Nordic and Baltic cinema markets. NCG was formed through the merger of Finnkino and Bonnier-owned SF Bio. The two companies were merged, and several value-generating growth initiatives were implemented, such as investments in more modern cinemas, enhanced customer offerings in the form of new digital distribution and ticket systems, as well as marketing and concession sales.

The basic concept, that cinema-goers in Nordic and Baltic countries want similar cinema experiences, and that larger distributors receive a better offer from one player with representation in the entire region, proved accurate.

“What we did in NCG is a good example of how Ratos’s business model works in practice. The merger of Finnkino and SF Bio was the foundation, and we were able to quickly benefit from the synergies through decisive action together with company management. It is remarkable how much can be accomplished in a short period when owners and management have a common agenda and pull in the same direction, "says Lina Arnesson, Investment Manager at Ratos.

Facts about the investment

Investment year: 2011
Sales (EURm): 88,5
Reported EBITA (EURm): 8,6

Exit year: 2015
Sales 2014 (SEKm): 2 612
Reported EBITA 2014 (SEKm): 366 

IRR: 41%