Vancouver: Canadian industrialist Gerry Schwartz has added blockbusters to his bestsellers for us$250 million.

On Feb. 15, the ceo of Onex Corp. – leading a buyout group including Pacific Capital Group (controlled by digital cinema advocate Gary Winnick in Beverly Hills) and l.a.-based Oaktree Capital Management – signed a letter of intent to acquire faltering exhibition chain Loews Cineplex Entertainment.

In the new deal, Loews Cineplex and its u.s. subsidiaries will file for Chapter 11 bankruptcy in the u.s. and the independent Cineplex Odeon chain will seek protection through the Companies’ Creditors Arrangement Act in Canada. The investor group, with shareholder and regulatory approvals, will convert us$250 million in bank debt into 88% equity in Loews Cineplex.

Other than closing some screens and theatres, Loews Cineplex will continue business as usual.

Twenty-one theatres in the u.s. will immediately close and 25 will close in Canada over the next few weeks. At the time of the deal, the company operated nearly 3,000 screens and 365 theatres in the u.s. and 856 screens in 114 locations in Canada.

Loews Cineplex posted a us$186-million loss in its third quarter, a position exacerbated by the company’s aggressive expansion in what analysts call an overbuilt market.

Trading was halted Feb. 15 pending the takeover announcement. Shares were trading at us$0.39 on the New York Stock Exchange compared to a year high of us$4.56 and a low of us$0.19.

Earlier this year, Schwartz orchestrated the acquisition of Chapters by Indigo.ca, which is controlled by his wife Heather Reisman. *

-www.onexcorp.com

-www.loewscineplex.com