Cineworld shareholders: Shares in Regal Cinemas’ owner hit all-time low #Cineworld #shareholders #Shares #Regal #Cinemas #owner #hit #alltime

London
CNN
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Cineworld’s stock plummeted 36% Tuesday afternoon to an all-time low after the company said it had filed a plan to reorganize its business and shareholders would not recover any of their funds.

The embattled owner of Regal Cinemas said it had submitted a final version of the plan to a US bankruptcy court in Texas. It first announced details of the proposal on April 3.

The company said already back in February that it expected shareholders to be wiped out entirely by the bankruptcy process, even if it sold some of its businesses.

“The proposed restructuring does not provide for any recovery for holders of Cineworld’s existing equity interests,” the company confirmed in a statement Tuesday.

Under the plan, Cineworld’s lenders will cut its debt by $4.5 billion in exchange for equity in the reorganized company.

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, described the market reaction to Cineworld’s announcement Tuesday as “severe.”

Confirmation of the plan had “extinguished any remaining hope from shareholders that this route could be avoided,” she told CNN.

Like many of its competitors, the world’s second-biggest movie theater operator was hit hard by the pandemic, reporting a combined loss of $3.3 billion over 2020 and 2021. It filed for Chapter 11 bankruptcy in the United States in September.

Cineworld shares have lost 98% of their value since the company listed on the London Stock Exchange in 2007. They were last trading at 1.1 pence (1.4 cents).

The stock closed 33% lower on April 3 after the company announced its reorganization plan and said it would halt all efforts to sell its US, UK and Irish businesses.

Tuesday’s stock declines came as “remaining equity holders rushed to sell their shares in an attempt to recoup something,” Victoria Scholar, head of investment at Interactive Investor, an online trading platform, told CNN.

Cineworld reiterated that it hoped the restructuring plan — which the court and some of the company’s creditors have yet to approve — would help it emerge from Chapter 11 bankruptcy in the first half of this year. In the meantime, Cineworld said, its movie theaters will continue to operate “as usual without interruption.”

#Cineworld #shareholders #Shares #Regal #Cinemas #owner #hit #alltime