Cineworld’s stock price jumped on Tuesday after it received approval to tap into a $1 billion fund after settling with its landlords.
A U.S. bankruptcy judge granted Cineworld Group, the parent company of Regal Cinemas, access to more than $1 billion in funds after the world’s second-largest cinema operator reached a settlement with its landlords and lenders about an hour ahead of a triggered interest accrual on the debt.
U.S. Bankruptcy Judge Marvin Isgur signed the order Monday afternoon that includes Cineworld borrowing an additional $150 million and making a $1 billion debt repayment.
The judge signed the order after landlords and junior creditors dropped their oppositions to the repayment of $1 billion debt once Cineworld, based outside London, agreed to pay at least $20 million in rent accrued after Sept. 30.
The rents are determined in part by movie theater attendance with at least $5 million earmarked for a four-month period, according to an attorney representing Cineworld, per CoStar News.
Cineworld operates in three segments: the US; the UK and Ireland (UK&I) and the rest of the world (ROW).
The U.S. segment includes three cinema chain brands; Regal, United Artists and Edwards Theatres.
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CINE.L Stock Jumps 195%
Cineworld Group stock (CINE.L) jumped 195% on Tuesday to $7 from $2.75.
The stock surged as high as $9 per share.
The theatre stock had more than 412 million in trading volume on Tuesday, almost 7 times its average trading volume of 61 million.
It’s this type of continuous volume that initially triggered AMC Entertainment stock to surge to its all-time high of $72 per share.
Retail investors are perplexed by the fact that a struggling theatre chain company like Cineworld has a bigger share price than industry leader AMC Entertainment.
Afterall, it is AMC Entertainment that has amassed millions of followers and investors, beat earnings every quarter since 2021, and is innovating in NFTs, crypto, and a branded popcorn business.
But money speaks volumes, literally.
Volume is what caused AMC and GameStop to spike last year, and it’s what is going to cause the movie industry leader to spike again.
That is if retail investors remember to realize this.
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Sources: CoStar
I wonder if trading was halted for Ciné World? The system is not choking Ciné World like AMC is.
Good competition can be good for the overall industry. They should create challenges for movie turnout with a prize. Both theater chains would rock the profits.
I also agree apes need to pull together put some buying pressure on. Everyone’s buying but not at the same time. Maybe we need a tree with branches full of ape groups that buy on their branch day. Is it legal to do group trades…
Let’s start a discussion! Leave your thoughts below.
Unless I’m mistaken, this certainly us bearish. All they are doing is kicking the can down the road. They need millions of retail investors to save their bacon, and I dint know if that’s in the tarot cards. But, I’ll be the first to wish them a recovery. I dint mind if another theatre chain survives abd eventually thru es again. But I’ll stay with $AMC. I’m familiar with the sentiment. The crowds. The passion of the Apes.