Cineworld files for Chapter 11 bankruptcy protection in the US | Cineworld

Britain CineworldThe world’s second largest movie chain has filed for bankruptcy protection in the United States as it seeks restructuring after facing low audience numbers.

The group operates 751 cinemas including more than 500 theaters in the United States and more than 100 in Britain, Ireland and others throughout Europe and Israel. She owns the Picturehouse chain in Britain and Regal cinemas in the United States.

Cineworld said in a statement that it has filed for Chapter 11 protection, a court-supervised restructuring process that gives companies time to negotiate with creditors to reach a debt reduction settlement.

Cineworld said it “will seek to implement a deleveraging deal that will significantly reduce the group’s debt, strengthen its balance sheet and provide the financial strength and flexibility to accelerate and capitalize on Cineworld’s strategy in the film industry.”

The statement said he hopes to emerge from bankruptcy proceedings in the first quarter of 2023, and fund $1.94 billion from existing lenders to help him through it.

The company also warned existing shareholders that their holdings would likely be significantly diluted as part of the bankruptcy process.

Eric Snyder, a bankruptcy expert at Wilk Auslander, said Cineworld’s creditors didn’t give it “a lot of time to decide between reorganizing or selling it.”

“Traveling to the cinema to see a movie for two to three hours, spending $20 to $25, is not attractive anymore to a lot of people, especially young people,” Snyder said.

Cineworld shares have been falling since the beginning of the year as their situation deteriorated when people did not return to movie theaters in large numbers after the Covid lockdown was eased.

See also  Who could be CEO of Twitter if Elon Musk steps down?

Stocks fell in September when it was He acknowledged that he may file for bankruptcy.

Cineworld shares rose 10% Wednesday to 4.29p, but have been down 87% since the beginning of the year.

Analysts argue that Cineworld’s 2018 takeover of America’s Regal left it heavily indebted, leaving it in a bad position to tackle the pandemic.

Leave a Reply

Your email address will not be published. Required fields are marked *