Cineworld to exit dozens of cinemas in radical restructuring plan

Business

Cineworld is drawing up plans to axe dozens of British cinemas as part of a radical restructuring that would also include extensive rent cuts.

Sky News has learnt that the company, which until last year was listed on the London Stock Exchange, is considering closing about a quarter of its roughly-100 British multiplexes.

Cineworld also wants to renegotiate rent agreements at a further 50 sites, with the remaining 25 untouched by the restructuring.

Sources said the proposals were expected to be formally outlined to creditors including landlords in the coming weeks.

They added that the insolvency mechanism employed by the cinema operator was expected to be a restructuring plan rather than a company voluntary arrangement (CVA).

In response to an enquiry, a Cineworld spokesperson said: “We continue to review our options but we don’t comment on rumours and speculation.”

Sky News reported last month that Cineworld was holding initial talks about a sale with prospective buyers, and that it had then switched to a formal restructuring process.

The company is being advised by AlixPartners on the process.

Other cinema operators are expected to step in to take over some of Cineworld’s sites if a sufficient number landlords refuse to agree to the proposed terms.

The company trades from more than 100 sites in Britain, including at the Picturehouse chain, and employs thousands of people, although its public relations adviser has refused to confirm either figure.

Cineworld grew under the leadership of the Greidinger family into a global giant of the industry, acquiring chains including Regal in the US in 2018 and the British company of the same name four years earlier.

Its multibillion dollar debt mountain led it into crisis, though, and forced the company into Chapter 11 bankruptcy protection in 2022.

It delisted from the London Stock Exchange last August, having seen its share price collapse amid fears for its survival.

Under the deal struck last year, several billion dollars of debt were exchanged for shares, with a significant sum of new money injected into the company by a group of hedge funds and other investors.

Cineworld also operates in central and Eastern Europe, Israel and the US.

Since it emerged from bankruptcy protection, Cineworld has appointed a new leadership team, installing Eduardo Acuna, who ran Mexican cinema chain Cinepolis’s operations in the Americas, as its chief executive.

Eric Foss, a former Pepsi executive, was parachuted in as Cineworld’s chairman.

Major summer film releases in Britain include Despicable Me 4, A Quiet Place: Part One, and Alien: Romulus.

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