Canada's largest cinema operator Cineplex Entertainment is joining forces with Starburst Coin Machines to form the country's largest distributor of arcade games, to be called Cineplex Starburst.

Cineplex Entertainment will invest $4.5m cash and contribute a recently acquired gaming subsidiary to the new joint venture, which will be equally owned by the theatre company and Starburst Coin Machines.

The new company will be led by Starburst's president Len Keywood. Starburst has supplied and serviced the arcade games for the Famous Players brand theatres, now part of the Cineplex group, which owns or partly owns 130 theatres.

Starburst also supplies equipment to other arcades, amusement centres, bowling alleys and amusement parks and owns the Playdium FEC in Mississauga, Ontario.

Cineplex recently acquired New Way Systems, which supplied and serviced the arcade equipment in its Cineplex Odeon and Galaxy Cinemas and will merge the operation into Cineplex Starburst.

"This transaction will improve the operating margins within our current amusement game business and also improve the quality and variety of games available to our guests," said Cineplex CEO and president Ellis Jacob. "Merging the two companies together makes them stronger and will enable more opportunities for future growth as this business evolves."