Cineworld talks to banks and landlords as it tries to preserve cash
Under-pressure Cineworld on Tuesday said it is in talks with banks about getting extra overdraft facilities, as it outlined measures to preserve cash.
The firm, which had a $3.5 billion (£2.8 billion) debt pile as at December 31, said its entire estate of 787 cinemas in 10 countries has been closed due to the coranavirus crisis.
Cineworld said it is “discussing the group’s ongoing liquidity requirements with our RCF (revolving credit facility) banks”.
Cineworld shares today jumped 14.37p, more than 36%, to 53.98p after it updated on measures to preserve cash. The firm said it is also in discussions with landlords, film studios and suppliers.
Meanwhile the payment of the fourth quarter dividend totalling $58 million has been suspended and the executive directors have agreed to defer payment of their full salaries and any bonuses to which they are entitled.
Shares in the chain, led by Mooky Greidinger, have fallen around 76% so far this year. Investors have been concerned about the debt pile and whether the firm has been overstretching with big US expansion plans.
In 2017 it agreed a $3.6 billion deal for the Regal chain, and in December it outlined plans to buy Canada’s Cineplex chain in a C$2.8 billion agreement.
The Cineplex purchase is ongoing.
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