24th Feb 2023 09:19
(Alliance News) - Cineworld Group PLC on Friday said it has received non-binding proposals from a number of counterparties for some or all of its businesses, but the debt-ridden business expects any deal with its creditors will wipe out its shareholders.
Shares were down 25% to 2.99 pence each on Friday morning in London. The stock is down 92% over the past 12 months.
"None of these proposals involves an all-cash bid for the entire business," the beleaguered cinema chain confirmed.
At present, Cineworld said that none of the proposals received to date would provide "any recovery" for holders of its equity interests.
It is thought that any rescue deal for the business will mean handing over control to the companies and people that Cineworld owes money to. And shareholders are unlikely to get anything back.
The world's second-largest cinema chain now expects to emerge from Chapter 11 proceedings in the first half of the year. Business operations continue as usual, the firm said.
Back in September 2022, Cineworld confirmed it was beginning a Chapter 11 filing in US Bankruptcy Court in Texas, as it grappled with liquidity woes.
It had first announced it was considering a Chapter 11 filing on August 22, and any deleveraging would likely result in a "very significant dilution" of its shares.
Since then, there have been reports that Cineworld has been in discussions with London-based Vue International and Toronto-based Cineplex. Before the Covid-19 pandemic, Cineworld had agreed to buy Cineplex, but later backed out and was ordered to pay damages to Cineplex by a Canadian court.
By Xindi Wei, Alliance News reporter
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