Image Source: Alexey Ivanov

$750m liquidity deal to keep Cineworld rolling if cinemas reopen by May

An international cinema chain has announced that it expects to survive without lender support if cinemas reopen by May 2021.

Cineworld, headquartered in London, reported today that it has secured $750m in additional liquidity, which it says means that it can survive another six months without cinemas opening.

The company has secured a new debt facility of $450m and issue of equity warrants, and has agreed bank covenant waivers until June 2022.

The company has said that this will provide it with “financial and operational flexibility” until business returns to normal.

However, it added that this assumes a reopening of cinemas “no later” than May 2021 - and that if there is a further delay, it is likely to require lender support.

Alicja Kornasiewicz, chair of Cineworld Group plc, commented: “In light of the severe financial challenges facing the group arising from the significant disruption to the entire industry, the board is confident this additional liquidity will preserve and maximise shareholder value over the long term.”

Mooky Greidinger, CEO of Cineworld, said: “The measures we are announcing today deliver over $750m of extra liquidity to support our business.

“Over the long term, the operational improvements we have put in place since the start of the pandemic will further enhance Cineworld’s profitability and resilience.

“The group continues to monitor developments in the relevant markets in which we operate and our entire team is focused on managing our cost base.

“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.”

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