Edwards deal moving along

Mathis Winkler

NEWPORT BEACH -- Denver billionaire Philip Anschutz and a Los

Angeles-based capital management company will take control of Edwards

Theaters Circuits Inc. if a bankruptcy court judge approves the deal in

June.

Officials for the financially ailing Newport Beach movie theater

company announced Thursday that Anschutz and Oaktree Capital Management

LLC will receive preferred stock and 51% of Edwards’ shares in return for

a $56-million investment.

The Edwards family, which has owned the company for more than seven

decades, will hold preferred stock and 49% of the shares.

A new seven-member board of directors, composed of W. James Edwards

III, the company’s current chief executive and individuals designated by

Anschutz and Oaktree, will assume control when the takeover occurs.

The company filed for bankruptcy protection in the U.S. Bankruptcy

Court in Santa Ana in September. Company officials cited a public demand

for state-of-the-art stadium megaplexes and a drop in attendance at older

theaters as the reason for Edwards’ money problems.

Under the terms of the Anschutz takeover, the company will repay debts

to banks of about $215 million plus interest. Vendors and movie studios

should also get back between 90% and 100% of debts of about $36 million

plus interest.

If a judge rules that the company’s reorganization disclosure

statement is adequate at a June 29 hearing, Edwards’ creditors will have

to vote on the deal. The company’s major creditors have already indicated

their support, according to company officials.

If the deal goes through, the reorganized company could emerge from

bankruptcy protection by October, Edwards said in the statement.