Cineworld said on Monday it would no longer put up for sale its U.S., UK and Ireland businesses as the movie chain operator failed to find a buyer for the group, sending shares in the cinema chain operator down 35%.
The company, which put a majority of its business under Chapter 11 bankruptcy protection in the U.S. in September, said it had proposed a restructuring deal with lenders to reduce debt by about $4.53 billion, mainly through creditors getting equity in the reorganised group.
It also plans to raise $2.26 billion to emerge from bankruptcy under the proposed deal.
"This agreement with our lenders represents a 'vote-of-confidence' in our business and significantly advances Cineworld towards achieving its long-term strategy in a changing entertainment environment," CEO Mooky Greidinger said in a statement.
The world's second-largest cinema chain operator behind AMC Entertainment said it would continue to consider proposals for the sale of its 'Rest of World' business, comprising operations outside the U.S., UK and Ireland.
Private equity firm CVC Capital Partners and activist investor Elliott Management last month have proposed separate takeover bids for the cinema operator's eastern Europe and Israeli operations, Sky News had reported.
"Cineworld has determined that, absent an all-cash bid significantly in excess of the value established under the proposed restructuring, the marketing process as it relates to the Group's business in the US, the UK and Ireland will be terminated," it said in a statement.
Shares in the London-listed company were down 35% at 1.89 pence by 0721 GMT.
Source: Reuters
Image: Bloomberg
