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Ended up only out in 734 million. Tried to use the billion to pay back their loans. DIP takes priority in repayment terms. Judge ruled this illegal. So was not passed. They have one billion in loans. But are at the bottom of the heap. HSBC are at the top. So will be first in line to get any money if the company goes bust and also get the lions shares in any debt for equity swap. But their lack of involvement, shows they do not want a debt for equity swap as this would wipe out out any chance they have of making a profit, or even get their money back.
Considering they have spent 400 million. For two films, yet director to get 100 million as well as Daniel Craig. They need to make money now off there films. As subscriber numbers are constantly falling now.
HSBC need to approve any debt for equity swap. Without them this is dead in the water.
This investment firm tried to do something that was not legal and the judge blocked it.
Either they get all the creditors to agree or there will not be a debt for equity swap.
That is why Goldman Sachs has a three percent stake in Cineworld and has not rushed for the hills. They know where HSBC stands and they know financial law inside out. Well their lawyers do. I would not be surprised if GS increase their stake in the coming weeks. IMO
Because a DIP is not a debt for equity swap. This is a chapter 11. Also the equity is in the U.K. and needs to be carried out in the U.K. also debt for equity cannot be done by the minority creditor without all the creditors involved. After the judge ruled the 1.94 billion illegal. They cut back to 734 million they will take 20% interest as the judge steered them to. Anything else will have to be done once the chapter 11 procedure is completed. IMO
The 700 million is a loan to continue operations. No equity can be given for it. Hence the judge said they can charge up to 20% interest only. And also told them money to pay off their loans was illegal. Times did not mention that.
Long way to go. But so many complications, that the press do not have a clue. They are relying on certain parties telling them things, which only have a kernel of truth and is not wholly true. IMO.
Shares are worthless now. Plus Times always posts negative stuff against Cineworld..someone is paying them good money to release these articles..
The important date is October 6 start of appeal with Cineplex. Once that concludes and synergies fine is wiped out. Watch the SP climb. IMO
Judge said no to this. DIP is for running costs only.
Investment firms were trying to get the company for free.
The papers do not know the intricacies or the law.
Expect no more funding than the 734 million. They will take 20% interest on this. As the judge advised.
They were looking to make a couple of billion in a few years. And fell at the first hurdle.
A debt for equity swap will need all the creditors involved. The investment firms are only owed 1 billion from the 4.8 billion. Minority players.
This will now go to chapter 11 and the negotiations with landlords and lenders will begin. Including these investment firms.
Am sure Mooky was to benefit from the investments scheme and will now have to seek other ways to stitch up shareholders and creditors alike. IMO
As lenders cannot pay off their loans. And this is a dip, not a debt for equity swap. They will take the 20% interest on the current loan. And conclude the chapter 11. IMO
Lots of stuff trying to be sneaked through. But debt for equity, has to have parity and needs creditors to all agree. Cannot get minority creditors to take all the shares against the majority creditors. That is why plenty of buys occurred. Firms now confident that money has been loaned to see Cineworld through till December and no dilution of shares for the time being.
Read the judges ruling. He blocked the 1.24 billion lenders were using to pay off their loans. Debt for equity needs all the creditors to be involved. HSBC owed 2 billion. They need them involved, as main creditor.
Similar to mortgage. 1st charge is all important. IMO
They cannot do the debt for equity swap as this is illegal and the judge stopped it.
The lenders wanted to pay back their original loans.
Cannot do this as they have to pay the biggest creditors first.
So I expect them to have to back down and take 20% interest on the current loan of 700 million. Agree to get paid this first. IMO
It was a buy. You always buy under share price and sell over share price.
On a lot of things need 66% approval from share holders. Set in stone. Business law.
Shareholders always have a say. As owners of the company. Just regulations differ.
Means that. They are officially on Aim and not covered by FTSE. So shares price can rise and fall with greater volatility.
Explain how Cineworld can dilute shares, when the shares are almost worthless already. Lenders want this share price much higher. This will be bouncing around all year. Negative and positive spins. IMO
No lenders and company need to buy shares to take company private. Any dilution to shares will make all the shares worthless. There’s and ours. IMO
This has a long way to go yet. So much needs to happen. Chapter 11 allows for negotiations. It does not mean both creditors and landlords will and have to agree reduced terms. They can simply say no to any deal proposed and seek chapter 7 bankruptcy for Cineworld instead. Also chapter 11 is only for America. Mooky needs to come to a different arrangement for the U.K.
Not only that but they have not borrowed 1.94 billion. This is a credit facility which might only need 200 million until the big films come back and pays this off.
Also the appeal with Cineplex is still going ahead. Once the synergy payment gets wiped. Lenders will view Cineworld differently. IMO
The chapter 11 has to be approved in court. Am sure that gives creditors and other parties a chance to object.
Also seems strange filling for chapter 11 in Texas, when there American entity is registered in New York.
I feel Mooky will take a 20% stake in the new company. If this all gets approved. Lots of stuff they need to do, which they have failed to mention.
Trading firms lawyers and experts will be all over what is going on. Follow their lead. If Goldman Sachs buys more, you know there is a play to be had. IMO
Adam Aron, basically telling Mooky he is getting wrong and needs to embrace retail investors, as AMC is in a far better position because of them. If Mooky continue on this path. Cineworld will be fully bankrupt before the end of 2023 is up.IMO