24th Jan 2020 07:46
(Alliance News) - Moody's Investors Service said on Friday it has assigned the B1 corporate family rating to the USD1.9 billion loan issued by Cineworld UK Holdco Ltd, a subsidiary of Cineworld Group PLC.
The rating action follows Cineworld's announcement in December that it had agreed to acquire Canadian cinema operator Cineplex which has a 75% box office market share.
Proceeds of the USD1.93 billion incremental term loan B together with USD343 million of bridge loan - due 2021- will be used to fund the Cineplex acquisition.
Moody's said the rating outlook remains stable, reflecting the expectation that the cinema chain will close the acquisition of Cineplex in accordance with the timetable outlined and the terms announced.
Gunjan Dixit, Moody's vice president and lead analyst for Cineworld, said: "Cineworld's B1 corporate family rating will be weakly positioned in the rating category following the acquisition of Cineplex."
"Although the box office will likely not be particularly strong in 2020, we expect the company to de-lever towards 5.0x by the end of 2020 mainly helped by earnings before interest, tax, depreciation and amortization growth from synergy realisation as well as some debt reduction," Dixit added.
By Ife Taiwo; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
CINE.L