Union to defend Odeon and UCI staff

BECTU will demand a fair deal for workers in two cinema chains if their new owner decides to shake them up.

Both Odeon and UCI, which together account for nearly 40% of the UK cinema exhibition industry, have been bought by equity group Terra Firma, led by entrepreneur Guy Hands.

Although one of the sale contracts has still to be sealed, and a competition review by government could be ordered, BECTU is bracing itself for a tough round of talks once Terra Firma begins to consolidate the two businesses.

The union is recognised for bargaining purposes at Odeon, where projectionists are covered by a collective agreement, but has no formal relationship with UCI.

However BECTU's cinema official David Beevers said: "This gives the union an opportunity to extend its agreement with Odeon across the UCI sites".

Terra Firma's plans for the two companies are not clear at the moment, but the union believes that they will fit together well without any need for major cuts at cinemas. Odeon's historical base is in high street cinemas, while UCI has concentrated on out-of-town multiplex sites, meaning that there is limited overlap in their markets.

At head office level, though, there could be scope for rationalisation of the two operations, and the union fears there could be cuts in management, marketing, and admin areas.

Company managers have played down rumours that Terra Firma's £580m purchase deal was based on a plan to close down cinemas, particularly in high street locations, and cash in on their property values by selling them.

The sale of Odeon and UCI is the latest episode in a long period of turmoil within the UK cinema sector. Just after Terra Firma's deal was announced, the country's second largest cinema chain UGC was put on sale for £400m by its troubled French owner, the media company Vivendi.

Pundits have predicted that UGC could be bought by rival chain VUE, itself the result of a merger only last year between Warner Village and SBS.

For Odeon staff, the Terra Firma takeover is their third change of owner since they were sold off by the Rank Organisation in 2000. Initially taken over for £280m by venture capitalists Cinven, who had already bought ABC Cinemas from Virgin for £70m, they were sold on to a consortium led by German bank WestLB only three years later for £430m.

The latest sale is not the first time that WestLB has had dealings with Terra Firma's Guy Hands. Boxclever, one of his previous ventures created by the merger of TV rental businesses owned by Thorn and Granada, cost WestLB £400m in written-off loans.

8 October 2004