Cineworld, the world’s second largest cinema operator, has agreed with its creditors on a major debt restructuring and capital injection. Cineworld said creditors, who account for more than 80% of its claims on it, have agreed to swap $4.53 billion of debt for equity. Additionally, they will inject another $800 million through a rights issue at a 25% discount to the implied equity value of the new company.
Furthermore, they will provide the group with another $1.46 billion in new financing for the company’s exit from Chapter 11. Cineworld collapsed under the weight of debt when the pandemic forced governments around the world to close cinemas to stop the spread of COVID-19. The stock fell by 20% to 2.3 pence on the London stock exchange, after having suffered drops of up to 39% in the early stages of the session.
