Cineworld surged on Friday after a US bankruptcy court gave the cinema chain access to up to $785m of an approximately $1.94bn debtor-in-possession financing facility as part of its Chapter 11 bankruptcy filing.
The company announced earlier this week that it had filed for Chapter 11 in the US. The group said the filing involved businesses in the US, UK and Jersey and that the Chapter 11 restructuring process was expected to significantly reduce debt and strengthen the balance sheet and liquidity position.
Cineworld said the ‘first day’ relief, along with its available cash reserves and cash provided by operations, is expected to provide sufficient liquidity for the group to meet its ongoing obligations. This includes post-petition obligations to vendors and suppliers, as well as employee wages, salaries and benefits programs.
The remainder of the DIP facility will become available upon court approval on a final basis.
Chief executive Mooky Greidinger said: “Today’s approval of our requested ‘first day’ relief is a positive step forward for the group and our restructuring efforts.
“As we position Cineworld for long-term growth, through this Chapter 11 process and beyond, we remain steadfast in our commitment to providing our guests with the most memorable moviegoing experiences and maintaining our long-standing relationships with our business partners.”
At 0910 BST, the shares were up 15% at 4.75 p.
