The company announced Monday that it would abandon efforts to sell its U.S. and U.K. businesses, unless an unlikely all-cash bid is offered that stands “significantly in excess of the value” of the company’s current worth.
The company also announced a debt restructuring plan in which lenders will reduce Cineworld’s debt by $4.53 billion in exchange for equity, while providing $1.46 billion in new debt.
As of mid-afternoon Monday, Cineworld stock is down -32% in a single day on the news, down to levels last reached in August 2022.
The company filed for bankruptcy in September 2022, along with a public pledge to emerge from it during the first quarter of 2023. The bankruptcy only applied to Cineworld’s operations in the U.K., the U.S., and the British crown dependency of Jersey.
Regal has announced plans to close or renegotiate leases across dozens of U.S. locations in recent months. That includes some of the company’s largest American sites, such as Union Square Stadium 14 in New York City, Sherman Oaks Galleria 16 in Los Angeles, South Beach Stadium 18 in Miami, Village Square Stadium 18 in Las Vegas, and Gallery Place Stadium 14 in Washington, D.C.
Cineworld is the second-largest cinema exhibition chain globally, behind only AMC. Subsidiary Regal Cinemas is also the second-largest cinema exhibition chain in North America, according to Boxoffice PRO‘s Giants of Exhibition 2023 — also only behind AMC.
“This agreement with our lenders represents a ‘vote-of-confidence’ in our business and significantly advances Cineworld towards achieving its long-term strategy in a changing entertainment environment,” Cineworld’s CEO Mooky Greidinger said in a press release.
“With a growing slate of blockbusters and audiences returning to cinemas in increasing numbers, Cineworld is poised to continue offering moviegoers the most immersive cinema experiences and maintain its position as the ‘Best Place to Watch a Movie.'”