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Cineworld Group PLC on Friday said it won court approval for up to $785 million of $1,94 billion debtor-in-possession financing facility.
Shares were up 11% at 4.60 pence each on Friday morning in London. The stock remains down 77% in the past month.
The movie house chain said that, together with its cash reserves and cash provided by operations, the financing facility is expected to offer sufficient liquidity to meet its ongoing obligations, including ‘post-petition obligations to vendors and suppliers, as well as employee wages, salaries and benefits programmes’.
Cineworld said the approval was from the US Bankruptcy Court for ‘first day’ relief relating to its Chapter 11 proceedings.
‘Today's approval of our requested 'first day' relief is a positive step forward for the group and our restructuring efforts,’ Chief Executive Officer Mooky Greidinger said.
He added: ‘As we position Cineworld for long-term growth, through this Chapter 11 process and beyond, we remain steadfast in our commitment to providing our guests with the most memorable movie-going experiences and maintaining our long-standing relationships with our business partners.’
On Wednesday, Cineworld began Chapter 11 filing in US Bankruptcy Court in Texas in the hope that the restructuring process will ‘significantly reduce’ its debt, and strengthen its balance sheet and liquidity.
It had first announced it was considering a Chapter 11 filing on August 22, adding that any deleveraging would likely result in a ‘very significant dilution’ of its shares.
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