Cineworld’s share price has plunged more than 53 per cent today amid reports it is filing for bankruptcy.
Investors bailed out of the stock, leaving it with a share price of 4.5p a piece. However, shareholders have been stepping back for more than a year.
The cinema chain had been hit particularly hard by successive Covid-19 lockdowns. The company has lost some 94 per cent of its share price value over the past 12-months as it sought a pandemic turnaround.
Cineworld, the world’s second largest cinema business, had been lumbered with £4bn worth of debt at the end of the last financial year.
In its latest trading update on Wednesday, Cineworld said: “Despite a gradual recovery of demand since reopening in April 2021, recent admission levels have been below expectations.
“These lower levels of admissions are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the group’s liquidity position in the near term.”
The Wall Street Journal, however, has today reported that Cineworld had hired lawyers from Kirkland & Ellis and consultants from AlixPartners to advise the bankruptcy process.
City A.M. has contacted Cineworld for comment.