Cineworld shares drop as filed plan would wipe out shareholder value

(Alliance News) - Beleaguered cinema chain Cineworld Group PLC on Tuesday updated on its Chapter 11 proceedings in the US, filing a plan of reorganisation in a Texas bankruptcy court and a disclosure agreement.

It noted that the plan would mean a wipe out of shareholder value.

Cineworld shares were 27% lower at 1.27 pence each in London on Tuesday morning.

The company reiterated the plan has support from lenders holding a majority of its various debt instruments. It seeks to confirm the plan on an "expeditious" timeline, and confirms the restructuring does not allow for recovery of any shareholder value.

"During the restructuring process, Cineworld continues to operate its global business and cinemas as usual without interruption," it said.

The firm said any sale from the marketing process could delay beyond the first half of 2023.

It added that the plan was backed by lenders that hold about 83% of long-term loans due in 2025 and 2026, and about 69% of debtors' outstanding indebtedness under the debtor-in-possession financing facility.

The company said that during the process, business as usual was operating with assets remain operational.

By Tom Budszus, Alliance News reporter

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