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April 3 (Reuters) – Cineworld ( CINE.L ) has scrapped plans to sell its U.S., U.K. and Ireland businesses after it failed to find a buyer, the cinema chain operator said on Monday, as it unveiled a new debt restructuring plan.
The operator of the world’s second-largest cinema chain behind AMC Entertainment ( AMC.N ) placed most of its business in U.S. Chapter 11 bankruptcy protection in September.
It said it aims to reduce its debt by about $4.53 billion under a new deal with creditors, mainly because creditors will acquire equity in the reorganized group.
As of June 2022, it had $8.81 billion in net debt, including lease liabilities.
The plan also includes raising $2.26 billion to exit bankruptcy this year.
“This agreement with lenders represents a ‘vote of confidence’ in our business and represents significant progress towards Cineworld’s long-term strategy in a dynamic entertainment environment,” CEO Mookie Gredinger said in a statement.
“Cineworld has determined that the transaction process in relation to the group’s business in the US, UK and Ireland will be terminated if the all-cash bid is not offered significantly above the value established by the proposed restructuring process,” it said. press release.
In the year It said it will continue to consider a proposal to sell its ‘Rest of the World’ business, which accounts for 13% of its revenue by 2021 and includes operations in Poland, the Czech Republic, Slovakia, Hungary, Bulgaria, Romania and operations. Israel.
Private equity firm CVC Capital Partners and activist investor Elliott Management made separate takeover bids for the Eastern European and Israeli operations last month, Sky News reported.
Shares in the London-listed company are down more than 99 percent from their all-time highs in 2017.
They fell as much as 38% to 1.8 pence in early trading on Monday.
The company reiterated that shareholders will lose out in its restructuring plans.
Reporting by Abby Jose Koilparambil and Yadarisa Shabong in Bengaluru; Editing by Louise Havens and Jason Neely
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