On October 10, 2013 the Competition Bureau issued a no-action letter in respect of the acquisition by Cineplex Inc. (Cineplex) of 24 movie theatres in Atlantic Canada from its competitor, Empire Theatres Ltd. (Empire), indicating that the Commissioner does not, at this time, intend to challenge the proposed acquisition pursuant to section 92 of the Competition Act.
By way of background, Cineplex originally sought to acquire two additional theatres in Ontario along with Empire’s 24 movie theatres in Atlantic Canada. Following a three-month review of the proposed transaction, the Bureau raised concerns over the competitive overlap of the parties in Ontario, determining that the proposed transaction would likely result in a substantial lessening of competition in that province. The Bureau had no concerns with respect to a lessening of competition in Atlantic Canada, as Cineplex currently has no theatres there.
In a "fix-it-first" solution, the proposed transaction was subsequently restructured so that an alternative buyer (Landmark Cinemas) would acquire the two Ontario theatres. Landmark Cinemas currently operates 31 theatres across Western Canada. The two theatres acquired from Cineplex, along with the additional purchase of 20 theatres from Empire (announced on June 27, 2013), will make Landmark Cinemas the second-largest cinema chain in Canada. Cineplex will remain Canada's largest theatre chain, operating a total of 161 theatres across the country.