End credits for Cineworld’s shareholders under restructuring plans
Cineworld’s shareholders could be wiped out following restructuring plans at the global cinema chain.
The chain has filed a plan of reorganisation and a disclosure statement with a United States bankruptcy court in Texas.
The group is currently undergoing “Chapter 11” bankruptcy proceedings, sometimes referred to as a “reorganisation bankruptcy”, in which a debtor usually remains in control of the business and is allowed to secure new funding.
Plans for a restructure of the company are supported by lenders who currently hold and control approximately 83% of loans and the chain’s revolving credit facility.
However restructuring plans do not provide “any recovery for holders of Cineworld’s existing equity interests.”
The chain previously announced its aim to emerge from the bankruptcy proceedings during the first half of 2023, however it has said that any sale of the company may delay this.
Cineworld added that during these proceedings, it will continue “business as usual”. The chain operates screens in the United Kingdom, Ireland, the United States, Poland, Czechia, Slovakia, Hungary, Bulgaria, Romania, and Israel.