AMC Entertainment Holdings Inc (NYSE:AMC), the biggest movie theatre chain in the world, has won over the House of Saud, which is granting the group the first license to operate movie theatres in Saudi Arabia.
The move by Saudi Arabia to scrap a 35-year ban on cinemas has created a fierce contest among Western movie theatre chains, who are looking to break into the market. Having emerged victorious and won the first license, AMC will open its first theatre in Riyadh in two weeks' time on April 18.
Saudi market is very large
As it has a population of more than 32 million, most of whom are under 30 years of age, Saudi Arabia will become one of the largest markets for moviegoers in the Arab region.
The decision to lift the 35-year ban on movies comes as part of Saudi Arabia’s new social and economic reform program called Vision 2030, which is being spearheaded by the Crown Prince Mohammed bin Salman.
“The granting of the first license marks the opening of very significant opportunities for exhibitors. The Saudi market is very large, with the majority of the population under the age of 30 and eager to watch their favourite films here at home,” said Dr. Awwad Alawwad, Saudi Arabia’s minister of culture and information.
Saudi Arabia is set to have nearly 350 cinemas, with over 2,500 screens, by 2030.
As part of Vision 2030, the Saudi Government is hoping to increase Saudis’ spending on culture and entertainment to 6% by 2030, up from the current 2.9%.
Shares in AMC Entertainment Holdings Inc. were up 5.5% at US$16.25 in Thursday's late afternoon trade.