(Sharecast News) - Shareholders in embattled movie theatre operator Cineworld will be cleaned out as part of the group's latest proposals to reorganise and exit Chapter 11.
Cineworld has filed a reorganisation plan with an American bankruptcy court that details just how it plans to restructure its $5.0bn of debt in order to exit bankruptcy protection during H1.
It will require approval from the Southern District of Texas, Houston Division bankruptcy court and certain creditors but stated that due to its high levels of debt, the proposed restructuring "does not provide for any recovery" for its existing shareholders.
"Consistent with the Company's announcement on 3 April 2023, in light of the level of existing debt that is proposed to be released under the Plan, the Proposed Restructuring does not provide for any recovery for holders of Cineworld's existing equity interests," the company said on Tuesday.
Cineworld said its plan had been backed by lenders, which hold and control about 83% of loans due to be repaid in 2025 and 2026 and its revolving credit facility, due to be repaid in 2023 and added it was also supported by those holding and controlling about 69% of its outstanding debts.
The London-listed group stated it wants to exit bankruptcy protection as soon as humanly possible, but noted that this may very well be pushed out beyond the first half of 2023 if it were to sell off any part of the business.
As of 0840 BST, Cineworld shares were down 12.22% at 1.54p.
Reporting by Iain Gilbert at Sharecast.com
