26th Jun 2023 11:53
(Alliance News) - Cineworld Group PLC on Monday said it has filed for administration in the UK as part of its restructuring in an attempt to reduce debt levels.
Shares in Cineworld fell by 29% to 0.52 pence each in London on Monday morning.
The London-based cinema chain said its board of directors plan to apply to the English Court for an administration order, in relation to its Chapter 11 bankruptcy filing, which will apply only to itself as the listed parent and not its operating companies or subsidiaries.
Once administrators have been appointed, the company will take steps to transfer its assets to its wholly-owned subsidiary Crown UK Holdco Ltd and a newly incorporated company. Consequently, Cineworld expects its shares to be suspended from trading in July.
This comes after Cineworld announced in April it had filed a restructuring plan to a US bankruptcy court in the Southern District of Texas, as it was hit hard by the Covid-19 pandemic, which caused the enforced closure of its cinemas.
The cinema chain owner had said the plan was supported by lenders holding a majority of its various debt instruments, as well as lenders that hold about 83% of long-term loans due in 2025 and 2026, and about 69% of debtors' outstanding indebtedness under the debtor-in-possession financing facility.
Cineworld expects to emerge from the Chapter 11 cases in July, and will continue to operate its global business and cinemas as usual.
By Sabrina Penty, Alliance News reporter
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