Cineworld files for bankruptcy in the United States

Sept 7 (Reuters) – Cineworld, the world’s second-largest cinema operator, said on Wednesday it had filed for bankruptcy protection in the United States.

The application for Chapter 11 bankruptcy protection, which can allow a company to remain in business and restructure its debt, relates to Cineworld’s operations in the United States, United Kingdom and Jersey.

The group, owner of Regal cinemas in the United States, has repeatedly warned that any deleveraging operation will lead to a very significant dilution of existing Cineworld shares.

As the cinema industry struggles to recover from the COVID-19 pandemic, Cineworld is also facing cash flow difficulties.

The company went into debt to finance part of the $3.6 billion takeover of Regal in 2017, as well as to survive the health crisis.

Its net debt amounted to 8.9 billion dollars (8.95 billion euros) at the end of 2021. Excluding lease debts, it was 4.84 billion dollars (4.86 billion euros).

The title Cineworld had already fallen and registered an all-time low last month after a Wall Street Journal article evoking a risk of bankruptcy in the United States and the United Kingdom.

At the time of the closing of the London Stock Exchange on Tuesday, the value of the company amounted to only 54 million pounds (62.30 million euros).

Cineworld operates more than 9,000 screens in 10 countries and employs around 28,000 people. (Report Aby Jose Koilparambil and Yadarisa Shabong in Bangalore; French version Valentine Baldassari, editing by Tangi Salaün)