Cineworld secures £201m funding boost ahead of July reopening
The chain has agreed terms on a new debt facility amid the threat of a costly legal battle after pulling out of a deal to buy Canada’s Cineplex.
Cineworld has secured 250 million US dollars (£201 million) in extra funding from private investors as it gears up to reopen its cinemas next month.
The UK-based chain told investors on Monday that it has agreed terms on the new debt facility, which will mature in 2023.
It said the deal with unnamed institutional investors “further strengthens the group’s balance sheet as cinemas begin to reopen around the world”.
The move comes a month after the group secured an extra £90 million in funding after extending a revolving credit facility.
Cineworld announced in May that it plans to reopen all its UK cinemas in July, with Christopher Nolan’s new film Tenet expected to be one of its first releases.
The company said: “With the easing of lockdown restrictions in key jurisdictions, Cineworld is excited to welcome customers back to cinemas and enjoy the best place to watch a movie.”
The new funding announcement also comes amid the threat of a costly legal battle after pulling out of a £1.6 billion takeover of Canadian chain Cineplex.
Earlier in June, Cineworld said it was terminating the deal after “certain breaches” of the acquisition deal.
The takeover would have created North America’s largest chain of movie theatres to better compete with Odeon owner AMC Entertainment.
On Friday, Cineworld is set to file its latest set of quarterly results and reveal the full impact of months of theatre closures.
Last week, a report by rating agency Moody’s warned Cineworld and other chains could struggle even after reopening as Britons spend more time at home.
“Attendance will likely remain low at least for a few months due to social-distancing measures or moviegoers’ health concerns,” Moody’s vice-president and senior credit officer Gunjan Dixit said.