Member Info for WolfofWarks

I bought in here on Monday and was quite happy with the performance up until today.

Poor - you're probably better off just carrying out a simple google search of the C11 process and actually read what is says.

Shareholders are at the bottom of the queue. C11 is a bankruptcy process that allows a company to re-organise it's debts. This is nearly always at the expense of the existing shareholders. I shouldn't need to provide examples. Just think about it logically. A company that owes probably over $10bn now if you include all the lease obligations and DIP facility, much of which is secured by a powerful group of lenders who will control the outcome of this by virtue of them having the largest voting rights. The company have even pointed out on several occasions the likelihood of wipeout.

Stanley - the answer is very simple. The company have told you what is going to happen in the very early C11 RNS. This is further backed up by Isreal's opening statement on day one of the bankruptcy hearing. There are simply no refinancing opportunities available. This is because the debt taken on during covid (the priming facility) has such onerous conditions attached that are so favourable to the lenders of that debt that it makes it completely impossible to refinnce. This is why the DIP facility is nearly $2bn and why $1bn of it needs to be used to refinance the priming facility.

My agenda is simply to discuss what is going on here - I haven't made anything up or embellished anything. It's all in the published information/docs, you just have to open your eyes to it.

The simple answer is sensibly run profit making companies do not fall into chapter 11.

Of course yes but the c11 process has the objective of completing the D4E transaction.

The cost cutting etc has been an ongoing process since covid anyway.

The leaner the machine the more palatable it will be to the creditors and a higher chance of a settlement.

Bullsbears - the big negotiation is around the D4E. How much of the equity the secured holders will take in order to allow the balance sheet re-organisation to happen. It’s more relating to the capital structure rather than the operations.

Hi bullbears - I suspect that the plan gets put forward and then gets negotiated over which is why it takes so long. Cineworld themselves have said that they don’t expect to come out of the process until next year. All the legal stuff must be quite complex as well.

Regarding your point about this being a blip I think there is far more to it then that.

There are several threats ranging from PPV to poor and unoriginal production. It’s a competitive space now with the affordability of restaurants and other forms of entertainment raising in popularity like escape rooms, trampolining, etc.

They had to buy the shares though that the warrants entitled them to. How much was the value of the warrants compared to the book value of their holdings?

Secured lenders received $230m for $700m debt and they are ahead of unsecured creditors and shareholders in the queue.

Poor - just read up on marvel out of interest. The bond holders and shareholders got shafted. This was the comic book business before they started making the films and were eventually taken over by Disney.

Like?

The companies survive. The shareholdings in their pre C11 form do not.

Hexam agree 100%.

Hope you are well.

The likelihood is they are actually in the same side.

MA getting involved is like a shark circling the water.

That looks much more realistic.

TFG - I don't see how that could be. If they are buying materials in Asia it will be in USD.

https://www.hollywoodreporter.com/business/business-news/regal-owner-cineworld-bankruptcy-national-cinemedia-lawsuit-1235248616/

Still risky. One RNS could wipe it to zero in a flash.

I think the case for holding these companies short is quite strong still at the moment. There are so many headwinds and I don't see where the tailwinds come from in the near term. Some of these internet firms are way overstocked as well. Ted Baker have been giving 30% off for weeks now. ASOS have written off over £100m of stock.

They've had to scrabble to get stock in, then get hit by the COL crisis. Now the dollar cost to replenish new stock is through the roof. Every piece of good news like freight coming down, energy costs, etc, gets mitigated by a sh it storm of bad news. That's before you factor in the likely actual recession and the interest rate increases which will kick in the next 18-36 months or so as people come off fixed deals.

It's posted within the thread - hollyreporter article. Mooky has been tinkering with leases all year.

Mooky is running the company though right, why would the secured lenders be pulling out of leases. Cineworld are the 'debtor in possession'. Debtor being the party that owe the money. In possession being that they are still in control of the company, although under the supervision of the court.

Hi HNS - so you have verifiable information? I would be interested to see it. I know some shareholder listings were posted by Jeff a while back but some of the information was hard to reconcile.

I think sometimes PI look at holdings and think HL, IG, Barclays, etc, are IIs when they are normally PI's nominee accounts.

I would be flabbergasted if iis were holding 40%. They are nearly always the first to sell.