Case study

Company Background In 1979 Garth Drabinsky and Nathan Taylor formed Cineplex. From early on Cineplex saw itself as a niche player. They used small screens to show specialty movies and they employed this strategy not to challenge major chains, but to compliment them. Cineplex did well primarily because of their concept for carefully planned use of shared facilities. With this success they began to expand across Canada with a very rapid rate of expansion. During this …

…and overhead costs. They could also fight more aggressively for market share and look for international opportunities. The potential would also be there for more bargaining power with the distributors. Conclusion By seeking a merger this would benefit all the stakeholders in the organization, the management, the stockholders, and the customers through the benefits that would come about. Karp should continue to pay down as much debt as possible and aggressively seek merger opportunities immediately.