Cineworld said on Friday its shareholders may see the value of their equity wiped out as it looks to exit from Chapter 11 bankruptcy protection after it failed to find a buyer for the whole of the world’s second biggest cinema chain.
“No bid came near the $6-billion of secured indebtedness that exists on the company’s balance sheet today,” Kirkland & Ellis lawyer Joshua Sussberg, representing Cineworld, had said on Tuesday. Cineworld filed for U.S. bankruptcy protection in September to try to restructure its debt after being hurt by the pandemic and a lack of blockbuster movies.
Cineworld in the past few years has also faced tussles with disgruntled former investors of Regal and legal claims from its scrapped $1.65-billion takeover of Canada’s Cineplex.
What happens with the Cineplex legal penalty in the event of a Cineworld restructure? Anyone with legal expertise can provide some insight?