Business

Cineworld ditches sale of Irish, US and British businesses after failing to find buyer

Cinema chain proposes €4.2bn debt for equity swap with creditors, and plans to raise additional €2.1bn to exit bankruptcy

Troubled cinema group Cineworld has taken its Irish operation off the market along with businesses in the US and Britian. Photograph: Gareth Fuller/PA

Mon Apr 3 2023 - 09:03

Cineworld said on Monday it would no longer put up for sale its businesses in Ireland, the US and Britain as the movie chain operator failed to find a buyer for the group, sending shares in the cinema chain operator down 35 per cent.

The company, which put a majority of its business under Chapter 11 bankruptcy protection in the US last September, said it had proposed a restructuring deal with lenders to reduce debt by about $4.53 billion (€4.2bn), mainly through creditors getting equity in the reorganised group. It also plans to raise $2.26 billion (€2.1bn) to emerge from bankruptcy under the proposed deal.

“This agreement with our lenders represents a ‘vote-of-confidence’ in our business and significantly advances Cineworld towards achieving its long-term strategy in a changing entertainment environment,” chief executive Mooky Greidinger said in a statement.

The world’s second largest cinema chain operator behind AMC Entertainment said it would continue to consider proposals for the sale of its rest of world business, comprising operations outside the US, the UK and Ireland. Cineworld has one cinema in Ireland on Parnell Street in Dublin.

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Private equity firm CVC Capital Partners and activist investor Elliott Management last month proposed separate takeover bids for the cinema operator’s eastern Europe and Israeli operations, Sky News had reported.

“Cineworld has determined that, absent an all-cash bid significantly in excess of the value established under the proposed restructuring, the marketing process as it relates to the group’s business in the US, the UK and Ireland will be terminated,” it said in a statement.

Shares in the London-listed company were down 35 per cent at 1.89 pence by 0721 GMT. – Reuters

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