Cineworld's Backers to Invest £35m in UK Upgrades

Cineworld's US parent company is set to invest £35 million into modernizing its UK cinema estate, contingent on the success of a proposed restructuring plan. This initiative aims to enhance Cineworld's competitiveness against better-performing rivals and is outlined in a document shared with creditors ahead of a crucial vote next month. The funding is earmarked for capital expenditures, including refurbishments of viable cinema locations, as the company grapples with financial challenges. The restructuring plan comes as Cineworld faces significant pressure from landlords and creditors, with some sites categorized as Class B requiring rent reductions to ensure long-term viability. A spokesperson for Cineworld emphasized that the restructuring would enable the UK division to secure additional funding to address working capital needs and reduce liabilities. The company has struggled with liquidity issues, particularly concerning an upcoming rent payment due in June 2024. Cineworld's shift from exploring potential business sales to a formal restructuring process follows unsuccessful negotiations with prospective buyers. The cinema operator, which operates over 100 sites in the UK and employs around 4,400 staff, has seen its share price plummet since its delisting from the London Stock Exchange last August. The company has previously exchanged billions in debt for shares, receiving substantial new investments from hedge funds and other investors. As Cineworld navigates these challenges, it continues to operate in various regions, including Central and Eastern Europe, Israel, and the US, with major film releases on the horizon, such as "Despicable Me 4" and "A Quiet Place: Part One."