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Cineworld Group PLC is preparing to declare bankruptcy, as it struggles to recover from pandemic lows, the Wall Street Journal reported Friday.
According to people familiar with the matter, the London-based cinema chain has engaged with lawyers from Kirkland & Ellis LLP and consultants from AlixPartners to advise Cineworld on its bankruptcy process.
Cineworld is expected to fill a chapter 11 petition in the US, and is also considering filing for an insolvency proceeding in the UK.
https://www.wsj.com/articles/regal-cinemas-owner-cineworld-prepares-for-bankruptcy-filing-11660910944
Shares in Cineworld plunged 60% lower at 3.93 pence on Friday afternoon in London. In the past 12 months, they are down 94%.
On Wednesday, Cineworld warned that lacklustre trading was prompting potential financing decisions that could significantly dilute shareholders.
Cineworld said recent admission levels have been below expectations, despite a slow recovery of demand since re-opening in April 2021.
The lower admission levels stem from a ‘limited film slate’, according to the company, which it expects to persist until November. The low demand will be likely to hit trading and its liquidity position in the meantime, it said.
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