Cineworld scraps plan to sell Rest of World arm as fails to find buyer

(Alliance News) - Cineworld Group PLC on Tuesday said it has abandoned plans to sell its operations outside the US, UK and Ireland.

The embattled cinema operator said it received proposals from a "number of prospective counterparties" for its Rest of the World unit, though no possible bid met a value required by the company's lenders.

The Rest of the World segment includes operations in nations such as Hungary, Israel and Romania.

The company earlier in April said it failed to find a buyer for its key US, UK and Ireland operations. Cineworld entered into a restructuring agreement, leaving shareholders out of pocket.

Cineworld had said that the financial restructuring will see it raise USD800 million through an equity offering to its lenders, as well as USD1.46 billion in new debt financing from the lenders.

Last week Tuesday, Cineworld said it filed the plan to a US bankruptcy court in the Southern District of Texas.

The Brentford, London-based company was hit hard by the Covid-19 pandemic, which caused the enforced closure of its cinemas. It also backed out of the acquisition agreement for Cineplex Inc in Canada, leading to a legal battle.

Cineworld said it is still "business as usual" as it navigates the bankruptcy process.

"Cineworld and its brands around the world - including Regal, Cinema City, Picturehouse and Planet - are continuing to welcome customers to cinemas as usual. The group continues to honour the terms of all existing customer membership programmes, including Regal Unlimited and Regal Crown Club in the United States and Cineworld Unlimited in the United Kingdom," it added.

Cineworld plans to emerge from the Chapter 11 process during the first half of 2023.

Cineworld's stock was up 6.6% at 0.97 pence each on Tuesday morning in London. The stock is down 74% so far in 2023 and is a world away from the record high of around 329p achieved in May 2017.

By Eric Cunha, Alliance News news editor

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