AMC Entertainment says it will form a joint venture with Saudi Arabia's vast Public Investment Fund
Giant US cinema chain AMC Entertainment has signed a deal to build and operate movie theatres in Saudi Arabia after the conservative kingdom lifted a decades-old ban.
The deal, announced by AMC in a statement and confirmed by Saudi state media on Tuesday, will see the company form a joint venture with Saudi Arabia's vast Public Investment Fund.
No further details of the deal, including its financial conditions, were disclosed.
AMC said it hoped to "put the industry's best foot forward" in Saudi Arabia as the country opens up to modern entertainment.
"This announcement is a historic moment for the theatrical exhibition industry and a tremendous opportunity to connect AMC's movie products with the Kingdom of Saudi Arabia's more than 30 million citizens, many of whom we know are movie fans based on their regular visits to cinemas in neighbouring countries," AMC CEO Adam Aron said in the statement.
The Kansas-based company is the biggest cinema operator in the world, with 11,000 screens concentrated in the United States and Europe, many operating under its Odeon brand.
It will face stiff competition from regional heavyweights, namely Dubai-based VOX Cinemas, which is the leading operator in the Gulf and Middle East with more than 300 screens.
The CEO of VOX parent company Majid Al Futtaim, Alain Bejjani, told AFP on Monday that it would be looking to expand into Saudi Arabia.
"We... are committed to developing Vox Cinemas in Saudi Arabia and (to) make sure that every one of our Saudi customers will have a Vox Cinema close to them where they will be able to experience what they have been experiencing outside Saudi Arabia -- in Saudi Arabia," he said.
Saudi Arabia announced on Monday it was lifting the ban as part of a far-reaching liberalisation drive by Crown Prince Mohammed bin Salman that is shaking up the kingdom.
The government said it would begin licensing cinemas immediately and the first movie theatres are expected to open in March.
The country is expected to have more than 300 cinemas -- with over 2,000 screens -- by 2030, giving rise to an industry that would contribute $24 billion to the economy, according to the Saudi culture ministry.