Cineworld, the owner of Regal Cinemas, confirmed on Monday that it is considering filing for Chapter 11 bankruptcy in the United States and “associated ancillary proceedings in other jurisdictions” as part of an ongoing assessment of strategic options. .
“Any such deposit should provide the Group with access to short-term liquidity and support the orderly implementation of a fully funded deleveraging operation,” the movie theater chain said in an update on Monday. “Cineworld would expect to maintain operations in the normal course until and after any filing and ultimately continue operations for the longer term without significant impact to its employees.”
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The update comes after The Wall Street Journal reported on Friday that a potential bankruptcy filing could come “within weeks” and Kirkland & Ellis LLP and AlixPartners have been brought in as advisers on the process.
Kirkland & Ellis LLP and AlixPartners did not immediately return FOX Business’ request for comment. Cineworld declined to comment.
Cineworld shares fell more than 50% on Friday after the Journal report.
AMC CEO optimistic about the future as rival CINEWORLD shares sink
The Chapter 11 bankruptcy review comes after Cineworld said last week that recent admission levels were below expectations despite a gradual recovery in demand since its theaters reopened in April 2021.
He expects lower admission tiers to continue through November 2022 due to a limited movie slate.
Cineworld, which owns more than 500 theaters in the United States, said any deleveraging would result in a “very significant dilution of existing stakes” in the company.
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Cineworld is the second largest movie theater chain in the world behind AMC Theatres.
In a statement Thursday, AMC Entertainment CEO Adam Aron said that while the company’s slate of films for the third quarter of 2022 is expected to be “relatively weak,” the company continues to be “fairly optimistic about growing demand” for its cinemas. in the fourth quarter of 2022 and calendar year 2023.