Cineworld Bankruptcy Exit Plan Confirmed At Key Hearing; Attorney Defends Payments To Executives As Stockholders Are Wiped Out
deadline.comA bankruptcy court judge today gave a green light to a reorganization plan for Regal parent Cineworld, the key step needed for the giant movie theater chain to emerge from bankruptcy next month.
At a hearing, in an order from the bench, Judge Marvin Isgur of U.S. District Court for the Southern District of Texas said the agreement the parties had put together since Cineworld filed for Chapter 11 last fall was negotiated ‘at arm’s length,” “in good faith” and intended to preserve jobs and capital into the future across the far-flung business.
With some details and wording still being worked out, “I am going to confirm the plan,” Isgur said. Cineworld ran out of cash and couldn’t borrow more after prolonged Covid-related theater closures hit exhibition particularly hard.
Recovery was slow, and the company’s already high debt made a reset impossible. The restructuring will shore up its balance sheet and provide significant additional liquidity.
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