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Photo = Yonhap news |
[Alpha Biz= Kim Jisun] CJ CGV (079160) is in ongoing discussions with financial investors (FIs) regarding repayment of a 330 billion KRW investment in its Asian subsidiary, CGI Holdings. According to industry sources on June 22, the investment—secured in 2019 from Mirae Asset Securities PE and MBK Partners—has reached its repayment deadline as of June 19.
The original agreement included a plan to list CGI Holdings on the Hong Kong Stock Exchange by 2023. However, the COVID-19 pandemic and the rapid rise of streaming platforms such as Netflix disrupted global cinema markets, causing IPO plans to collapse. The contract included a drag-along clause, allowing FIs to compel a full sale of CGI if the IPO failed, with CJ CGV retaining a call option to repurchase the stake.
To delay full repayment, CJ CGV returned 126.3 billion KRW to the FIs last year. However, with the full repayment due again this year, both sides are back at the negotiation table.
CJ CGV’s financial position remains strained, making it difficult to meet the put option obligations. The company posted a net loss of 175.5 billion KRW last year—its seventh consecutive annual loss—and reported a debt ratio of 622% as of Q1 2025.
Some investors argue that selling CGI could help improve CGV's financial structure. CGI's operations in China, Vietnam, and Indonesia currently account for about 30% of CJ CGV's total operating profit—a level analysts believe could be offset by other business segments.
In particular, CJ CGV's 4D theater subsidiary, 4D PLEX, recently posted record-breaking monthly revenues of $14 million in North America. The company also signed new agreements with leading global cinema brand AMC, with plans to install 65 4D theaters across AMC locations in the U.S. and Europe by 2027.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
