LONDON (CelebrityAccess) – Cineworld Group, the owner of the Regal Cinema chain and the second largest cinema operator in the U.S., revealed they are considering a voluntary chapter 11 bankruptcy filing as part of financial restructuring.
“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. Cineworld is in discussions with many of its major stakeholders including its secured lenders and their legal and financial advisers,” Cineworld Group said in a notice to investors on Monday.
The announcement follows a caution to investors on August 17th that Cineworld’s theaters continued to face challenging conditions as theater audiences have yet to fully recover following the pandemic.
“Despite a gradual recovery of demand since re-opening in April 2021, recent admission levels have been below expectations. These lower levels of admissions are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the Group’s liquidity position in the near term,” Cineworld said in an investor notice on August 17th.
“Consequently, the Group has been taking proactive steps to ensure it has the balance sheet strength and flexibility to adapt to market conditions. This includes significant previously disclosed operational and financial initiatives to manage costs and enhance liquidity. The Group believes these steps are required to optimize its ability to maximize enterprise value as part of the recovery in the cinema industry,” the investor notice said.
Cineworld noted that despite the restructuring, their global Regal theaters were “open for business as usual.”
