The owner of Regal Cinemas scored a lifeline to help the financially challenged movie theater chain stay afloat.
Cineworld Group has secured a $450 million loan from lenders as coronavirus cases spike and theaters across the country remain closed. Other lenders provided increased flexibility on the company’s revolving loan and senior debt, adding over $750 million of liquidity to the company, the Wall Street Journal reported.
The deal comes just a week after reports that the entertainment company was seeking investors or a rescue deal to stay in operation. The company’s shares rose 20 percent in London on Monday to £55.30, or about $74.
The company reported that revenue in the first half of 2020 declined 67 percent to $712 million. It has $4 billion in lease obligations and $4 billion in debt overall. Last month, it temporarily shuttered its more than 500 U.S. theaters, which had reopened in August.
In the short-term, many movies are being released directly to streaming services, skipping traditional theaters altogether. But with more Americans couch-bound, demand for production space has surged. In June, Blackstone was in talks with Hudson Pacific Properties to develop production space in Los Angeles, a deal valued at $1.4 billion.
[WSJ] — Keith Larsen