Member Info for WolfofWarks

‘Also perhaps explains why Cineworld and Mooky may in fact not know who has been negotiating with AMC, independent groups have been set up each with their own advisers as a requirement of C11.’

I think you’ve hit the nail on the head here. The lenders are the real power brokers here. It’s their votes that will decide the outcome of this.

The more I think about this the more I feel they are not satisfied with the D4E CW are proposing and perhaps a complete sale is the only way forward now without going into chapter 7.

Maidit - there's monthly profit statements posted in the court docs - Hexam posted the docket numbers the other day. The company is having to be completely transparent in terms of current cash and profitability position in order to comply with the Chapter 11 process.

If the company offloaded the subsidiaries and the presumably a lot of the debt would go with them. The shell that would be left might contain the non-chapter 11 business. Could the company then raise capital (the dilution) to acquire cinemas, effectively wiping the slate clean and starting again but with the ROW business as a base. I'm just theorising how a group sale could still result in significant dilution.

In this scenario what would happen to the CP claim?

Does anyone know which company is being sued by CP? Is it the holding companies or one or a mix of the subsidiaries?

'As for assets, we need to appreciate, cineworld manages a movie distribution division, oversees advertising revenue as well.

I too would like to see what the detailed list of assets that remain within Cineworld after the sale, but it remains to be seen.'

'Furthermore, any sale transaction for the Group as a whole'

Retail - this is the important part of the RNS - they are looking to dispose of the whole group, not individual assets. If you look at the balance sheet most of the assets are operating leases and goodwill which are intangible and cannot be sold. The company has very little in the way of saleable assets.

'Wolf, the 10% remaining equity was an example projection to illustrate the dilution and specifically call out that it would be at pre-pandemic prices, not the current SP.'

This is completely unknown. The dilution will be dependant on how the market values whatever is left.

I suspect the lenders are not interest in the D4E - hence the extension and why they now need longer to try and sell the group as a whole. The confusion over this is the company are still talking about dilution.

The question now is how much can realistically be realised for the group in a sale and would the even clear the senior debt let alone the unsecured holders.

In an attempt to try and clear this up they have made the position completely ambiguous.

Giantsquid - C11 is the US version of an administration.

'Srini, the dilution would be at pre-pandemic price. The current market cap is removed from share price as it has already factored the CH11.

So it would be 200p - 90% equity lost. 20p remains.'

How is a cinema group with no cinemas worth 20p?

This is a very confusing RNS. I still don't think the RNS 100% refutes that the lenders haven't been speaking to AMC - I mean why would they produce such a filing for the SEC. It's the use of the word 'understands' that is not 100% committed.

If they sell all the assets but not the company itself what is left? The group outside of the C11 process? A shell company.

Frasers in a brilliant business model and Mike Ashley is ruthless in his approach.

I read an article in the IC the other week about their latest results and the buying distressed companies on the cheap and selling them off is really paying for them now. I think he now owns 35% of Hugo Boss so diversifying into more upmarket brands as well. He's also bought Coventry City's football ground. Not too sure what that's about to be honest but there is a big retail park next to it.

FigTreeHarry, then Magnus, now Maidit.

There always seems to be a loopy trader on the board and once they move on they seem to be instantly replaced.

If I was a cynic I might think that they are the same person on multiple accounts.

Anyway I'm off to see Avatar.

Have a good afternoon all.

This is why I keep brining up in the online VS High street debate that for certain shoppers in towns there isn't actually anywhere to shop and it's getting worse.

I have to go 20 miles to Birmingham if I want a decent shopping day out.

I haven't looked at the wording for a while. But I suppose there is an argument when looking at the likelihood of it being paid if there is an appeals process to be played out then the provision is up for debate. Even so I've always been taught to look at accounts production from a worse case scenario.

It wouldn't make commercial sense for the studios to frustrate this any further. The court process and DIP assures them of payment as CW have the money secured for operational costs.

Plus they will want to continue the relationship post C11. CW is expected to come out of this - we just don't know who the owners will be and in what percentages and in what legal form.

'So if CINE forms a new entity and avoids the Cineplex problem that way, what would that mean for the shareholders (ourselves)? If the new entity is formed and the old one is scrapped, I assume the equity (and the investors) are also wiped out?'

Mountainous - this is the million dollar question.

My assumption would be that CP would have a stake in Newco as they would be one of the voting creditors, or at least would receive something in return - clearly not the value of their claim though.

Elvis I mentioned to you before that I thought it was strange that the company made no provision for the claim in the 2021 annual report and that they were so dismissive of it in the going concern statement. Yet if you look to the early court documents there is an unsecured creditors list and they are top of the pile. So the judgement exists in law and forms part of the chapter 11 proceedings even though CW refuse to basically acknowledge it in their accounts.

The point of the C11 is that the stay stops any winding up action. It protects the company from its creditors. Cineplex have some power in terms of voting as they are the largest in the unsecured creditor class by some margin - BNY Melon are second with a convertible bond of $213m. However it's the secured creditors who put up the DIP who have over 50% of the voting and will therefore decide the outcome. This is why the reporting points to CP and AMC negotiating with the creditors rather than Cine themselves.

Debts of old company will fall away. Each company has limited liability and is only responsible for its own debts. Think of companies that fall into administration only to bounce back as a new company with a slight change of name. Mothercare are an example in the UK are are now licensing their products through a deal with Boots.

I know they were trying to do a deal for Regal at one point with the lenders if the reporting is correct. They are the largest unsecured creditor - remains to be seen how much actual power this gives them.

Newco and a delisting will kill their claim dead though I would think.

As much as I would love to help the cause my local is a vue £7.49 vip.