Business as usual at Cineworld but confirms speculation about bankruptcy filing
Cineworld, the world’s second-largest cinema chain and owner of the Broughton Retail Park multiplex cinema has confirmed it is considering filing for Chapter 11 bankruptcy in the US.
A Chapter 11 bankruptcy allows a company to stay in business and restructure its finances.
Last week the Wall Street Journal reported that chain could file for bankruptcy “within weeks” after struggling to rebuild attendance from pandemic lows.
Cineworld said today it remains “open for business as usual and continues to welcome guests.”
It also said it expects to “maintain its operations in the ordinary course until and following any filing and ultimately to continue its business over the longer term with no significant impact upon its employees.”
The company also Tweeted on Saturday it was business as usual:
All of our Cineworld cinemas are open for business as usual, and we continue to welcome Cineworld Unlimited members and all of our customers, across the UK and Ireland.
We remain committed to being the Best Place to Watch a Movie.
— Cineworld (@cineworld) August 20, 2022
In response to media speculation, the company, which also owns the Picturehouse chain in the UK and Regal Cinemas in the US issued a statement this morning.
Cineworld said it was “providing an update to its announcement on 17 August 2022 regarding an evaluation of strategic options to both obtain additional liquidity and potentially restructure its balance sheet through a comprehensive deleveraging transaction.”
“Cineworld and Regal theaters globally are open for business as usual and continue to welcome guests and members.”
“The strategic options through which Cineworld may achieve its restructuring objectives include a possible voluntary Chapter 11 filing in the United States and associated ancillary proceedings in other jurisdictions as part of an orderly implementation process.”
The statement goes on to say: “Cineworld is in discussions with many of its major stakeholders including its secured lenders and their legal and financial advisers.”
“Any such filing would be expected to allow the Group to access near-term liquidity and support the orderly implementation of a fully funded deleveraging transaction.”
“Cineworld would expect to maintain its operations in the ordinary course until and following any filing and ultimately to continue its business over the longer term with no significant impact upon its employees.”
“As previously announced, any deleveraging transaction would, however, result in very significant dilution of existing equity interests in Cineworld.”
“Cineworld’s evaluation of these strategic options remains ongoing. A further announcement will be made if and when appropriate.”
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