Shares of Cineworld (CNNWF) are down more than 80% on media reports that the world’s second-
biggest movie theatre chain plans to file for bankruptcy in the U.S.
The report, first published in The Wall Street Journal newspaper, said Cineworld has engaged
lawyers and consultants to advise it on Chapter 11 bankruptcy protection from its creditors.
The report also said that Cineworld is considering filing for bankruptcy in the United Kingdom,
where the company is headquartered.
Cineworld issued a news release last week saying that it is considering restructuring its debt.
The movie theatre chain accumulated large amounts of debt from acquisitions and has suffered
in recent years from pandemic lockdowns at its facilities around the world.
Cineworld said in its news release that it is “in active discussions with various stakeholders and
is evaluating various strategic options to both obtain additional liquidity and potentially
restructure its balance sheet.”
Cineworld is involved in an ongoing legal battle with Canada’s Cineplex (CGX). In December
2021, an Ontario Superior Court awarded Toronto-based Cineplex $1.24 billion in damages
after Cineworld abandoned an agreement to purchase Cineplex for $2.1 billion.
Shares of Cineworld are down 90% year-to-date and trading at 3.25 British pounds.
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