AMC Entertainment's headquarters will remain in Kansas City, MO, where the 229-theater, 3,546-screen-company currently resides. Loews is a bit smaller than AMC, with 221 theaters and 2,218 screens.

Peter C. Brown, AMC's chairman, CEO and president will co-chair the new company with Travis E. Reid, CEO and president of Loews. Marquee Holdings, the firm that owns AMC, will be the majority owner of the new entity. LCE Holdings Inc., Loews' owner, will get 40% of AMC Entertainment. They expect the deal to close within six to nine months.

The deal follows the recent acquisitions of both chains by private investment groups. Last July, JP Morgan Partners and Apollo Management, the controllers of Marquee Holdings, bought out AMC for $2 billion. The month before that, the stockholders of LCE Holdings, Bain Capital Partners, the Carlyle Group and Spectrum Equity Investors, purchased Loews for $1.5 billion. AMC had earlier been in talks to buy Loews.