Regal Owner Cineworld to File for Administration in U.K. as Part of Restructuring

Etan Vlessing
·2 min read

Regal owner Cineworld Group will file for administration in the U.K. and delist its shares from the London Stock Exchange.

In the latest update on its restructuring plan, Cineworld said its business would not be impacted by a planned emergence from U.S. bankruptcy protection set for July as assets in the cinema chain would be transferred to a new incorporated company controlled by lenders.

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Cineworld reiterated that it will be business as usual for the company as it races to complete a proposed restructuring to reduce a towering debt load. “The group and its brands around the world – including Regal, Cinema City, Picturehouse and Planet – are continuing to welcome customers to cinemas as usual,” the exhibitor said in its Chapter 11 update.

Behind the scenes, however, Cineworld, after completing its proposed restructuring, will have no interest in the newly incorporated company, or be part of the corporate rescue after shareholders and the existing equity they hold are wiped out.

The proposed restructuring, when completed, will restore Cineworld’s balance sheet by removing around $4.53 billion of debt, implementing a rights offering to raise around $800 million in new equity and offer $1.46 billion in new debt financing.

Cineworld filed for Chapter 11 bankruptcy protection in Sept. 2022 to restructure its overall debt burden. It then formally filed its reorganization plan in April 2023, which aimed to cut the firm’s debt by about $4.53 billion, mainly through lenders getting equity in the reorganized group in exchange for releasing their claims.

The Chapter 11 filing followed Cineworld failing to find buyers for some or all of its exhibition assets. On Monday, stock in Cineworld fell 21 pence, or 28 percent, to 53 pence on the LSE market.

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