Shares in Regal Cinemas’ owner hit all-time low
(CNN) -- Cineworld's stock plummeted 23% Tuesday morning to an all-time low after the company said it had filed a plan to reorganize its business, and shareholders would not recover any of their funds.
The embattled owner of Regal Cinemas said Tuesday that it had submitted the final plan, first announced on April 3, to the United States Bankruptcy Court for the Southern District of Texas to help it exit bankruptcy.
The company said already back in February that it expected shareholders to be wiped out entirely by the bankruptcy process, even if it sold some of its businesses.
"The proposed restructuring does not provide for any recovery for holders of Cineworld's existing equity interests," the company confirmed in a statement on Tuesday.
Under the plan, Cineworld's lenders will cut its debt by $4.5 billion in exchange for equity in the reorganized company.
Like many of its competitors, the world's second-biggest movie theater operator was hit hard by the pandemic, reporting a combined loss of $3.3 billion over 2020 and 2021. It filed for Chapter 11 bankruptcy in the United States in September.
Since Cineworld listed on the London Stock Exchange in 2007, its shares have fallen 98% to 1.3 pence (1.6 cents). The stock closed 33% lower on April 3 after the company announced its reorganization plan and said it would halt all efforts to sell its US, UK and Irish businesses.
On Tuesday, Cineworld reiterated that it hoped the plan — which the court and some of the company's creditors have yet to approve — would help it emerge from Chapter 11 bankruptcy in the first half of this year. In the meantime, Cineworld said, its movie theaters will continue to operate "as usual without interruption."
