The group operates 751 cinemas, including more than 500 in the United States, more than 100 in Britain and Ireland and others across Europe and Israel. It owns the Picturehouse chain in Britain and Regal cinemas in the US. Cineworld said in a statement that it has filed for Chapter 11 protection, a court-supervised restructuring process that gives companies time to negotiate with creditors to reach an agreement to reduce debts. Cineworld said it will “seek to implement a deleveraging transaction that will significantly reduce the group’s debt, strengthen its balance sheet and provide the financial strength and flexibility to accelerate and capitalize on Cineworld’s cinema strategy”. The statement said it hopes to emerge from bankruptcy in the first quarter of 2023 and had $1.94 billion in funding from existing lenders to help it. The company also warned existing shareholders that their holdings would likely be significantly reduced as part of the bankruptcy process. Eric Schneider, a bankruptcy specialist at Wilk Auslander, said Cineworld’s creditors were not giving it “much time to make a decision between reorganizing or selling it”. “Traveling to a movie theater to watch a movie for two to three hours and spend $20 to $25 is no longer attractive to many people, especially young people,” Snyder said. Shares in Cineworld had fallen since the start of the year as its position worsened when people failed to return to cinemas en masse after the easing of Covid restrictions. Shares plummeted in September when it acknowledged it may file for bankruptcy. Cineworld shares were up 10% on Wednesday at 4.29am but were still down 87% since the start of the year. Analysts say Cineworld’s takeover of Regal in America in 2018 left it saddled with too much debt, putting it in a bad position to weather the pandemic.
