Cineplex is selling its head office building in Toronto for $57 million as the company looks for cash to pay down debt.
The movie theatre chain says it will continue to lease back its Toronto headquarters for up to a decade but plans to consolidate its office space within the city.
Cineplex has been devastated by the COVID-19 pandemic that kept consumers away from movie theatres throughout 2020. In November, the company said that 91% fewer moviegoers came to theatres this past summer compared to summer 2019.
Cineplex Chief Executive Officer Ellis Jacob said he has high hopes for next year's movie slate, predicting that there will be pent-up demand for social activities after the rollout of COVID-19 vaccines.
Jacob also said the $57 million of proceeds from the sale of Cineplex’s Toronto head office, combined with a recent agreement from Scotiabank, will provide $117 million in cash to carry the company to the traditional start of the summer movie season in May.
Cineplex said that once the sale of its head office building is complete in January, about half of the proceeds from both deals will go toward paying down existing debt.
"We are confident in our response to COVID-19 and the actions we have taken to stabilize our financial position," Jacob said in a written statement.
