Cineworld, owner of Regal, secures new financing to tide it over until reopening
Cineworld, which last month closed hundreds of its movie theaters in the U.S. and Britain because of the coronavirus, has secured more than $750 million of new financing that it hopes will see it through the pandemic.
In a statement Monday, the company — which owns the Regal cinema chain in the U.S. — said its finances would be bolstered over the coming months largely from a new debt facility as well as an extension of an existing credit facility.
Cineworld closed about 660 theaters in the U.S. and Britain last month because of a lack of blockbusters as producers postponed releases because of the pandemic, including the latest James Bond film, “No Time to Die.”
“We look forward to resuming our operations and welcoming movie fans around the world back to the big screen for an exciting and full slate of films in 2021,” said Mooky Greidinger, Cineworld’s chief executive.
The group’s base-case scenario assumes a reopening of cinemas no later than May. In the event of a further delay, it said it expected to retain sufficient liquidity to remain in business for a number of months but said that that might require support from lenders.
Despite the caveat, news of the new financing arrangements sent shares in the company, which is Britain’s largest exhibitor, soaring 17% in London.
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The hope is that the new money will help the company ride out the pandemic until vaccines are available.
A number of COVID-19 vaccine candidates have shown promising results, including one being developed by drugmaker AstraZeneca and Oxford University, which announced Monday that their vaccine appeares to be up to 90% effective.
“With vaccine development progressing, this should give investors significantly greater confidence in Cineworld emerging from the crisis, allowing the company to capture demand as it returns with a robust slate of postponed films,” analysts at Investec wrote.