Cineworld ‘set to file for bankruptcy’ after slow Covid pandemic recovery | City & Business | Finance

Cineworld ‘set to file for bankruptcy’ after slow Covid pandemic recovery | City & Business | Finance

The firm, the second largest cinema business in the world with nearly 800 sites, has reportedly engaged lawyers from Kirkland & Ellis LLP and consultants from AlixPartners to receive advice on the bankruptcy process. It is understood Cineworld is looking into new options to improve its financial position after the industry was hugely affected by the COVID-19 pandemic.

Shares for the entertainment chain plunged more than 60 per cent – to a record low of 8.24p – on Wednesday, reports Birmingham Live. In a stock exchange statement earlier this week, Cineworld said it was in “active discussions with various stakeholders”.

A spokesman added: “Despite a gradual recovery of demand since reopening in April 2021, recent admission levels have been below expectations.

“These lower levels are due to a limited film slate that is anticipated to continue until November 2022 and are expected to negatively impact trading and the group’s liquidity position in the near term.

“The group has been taking proactive steps to ensure it has the balance sheet strength and flexibility to adapt to market conditions.

“The group’s business operations are expected to remain unaffected by these efforts and Cineworld expects to continue to meet its ongoing business counterparty obligations.”

But writing on social media, film fans were not surprised with Cineworld’s woes after the pandemic.

One man said: “Not surprised with the price it charges.”

Another posted: “Not surprised when you’re charged this much.”

A third stated: “Cineworld is so expensive! When you can go somewhere else for the same film at a cheaper cost, it’s no wonder.”

Others shared their sadness at their favourite cinema chain experiencing such trouble.

One woman posted: “Oh no. I’ve been a loyal customer for 11 years.”

Philippa Childs, head of entertainment and media union Bectu, told PA: “This is very worrying news, not least for the UK’s Cineworld and Picturehouse workforce who have already been through a tumultuous time during the pandemic.

“The UK’s cinema industry suffered an incredible blow due to Covid-19 and this latest news will be very unsettling for cinema workers.

“We will do everything we can to support our members during this challenging time and will be looking to Cineworld to mitigate the impact of any bankruptcy arrangements on its employees.”

Source link

Author: Shirley