Cineworld to file for administration
Embattled cinema chain operator Cineworld is set to file for administration and suspend trading on the London Stock Exchange next month as part of a major bankruptcy restructuring plan, the firm revealed today.
In a statement this morning, the cinema firm said its proposed restructuring would involve calling in administrators and could release approximately £3.56bn of its funded indebtedness, a rights offering to raise £629m and the provision of £1.15bn in new debt financing.
Bosses said this morning that administrators would shift all its assets into the ownership of a wholly owned subsidiary called Crown, while a newly incorporated company controlled by the Group’s lenders will become the sole owner of Crown, with Cineworld Group ceasing to have any interest in Crown or the rest of the Group.
“The proposed restructuring, when implemented, will transform the Group’s balance sheet and provide it with significant additional liquidity to fund its long-term strategy,” Cineworld said.
The firm said that as a consequence of its administration, the trading of its Shares on the London Stock Exchange’s main market for listed securities will be suspended next month.
Shareholders are set to be wiped out by the arrangements, however, with the firm confirming it would “not provide for any recovery for holders of Cineworld’s existing equity interests.”
Cineworld was founded in 1995.
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