On a quest to boost liquidity, Cineworld revealed this morning that it had approached the former dissenting shareholders of its U.S. division Regal Entertainment to further delay payment obligations.
It comes after the UK cinema chain said last month that it would fork out $170m to Regal shareholders, who were unhappy with the price of $23 per share they received following the Cineworld takeover in 2017.
The London-listed firm is laden with debt and said lenders of certain debt facilities have given waivers, or promises to waive, any “events of default” in order to help with talks with the former Regal shareholders.
The company said in an update this morning: “Cineworld has chosen to initiate these discussions with the aim of maximising its available liquidity and is hopeful that a satisfactory agreement can be reached. A further announcement will be made as and when appropriate.”
Cineworld is also in hot water over the deal with Canada’s Cineplex, which could result in damages of up to C$1.23bn for the already struggling entertainment company.
Despite these concerns, the cinema operator’s revenue has skyrocketed by $1bn (£760m) in the past year, as record-breaking blockbuster releases like Spider-Man: No Way Home have lured in viewers.
Admissions rose over 75 per cent in comparison with the 12-month period in 2020, as Cineworld steams ahead with its pandemic recovery and reaps the rewards of pent-up demand.