The world's second-largest movie theater chain behind AMC Entertainment Holdings Inc (NYSE:AMC), Cineworld Group PLC (OTC:CNNWF), filed for bankruptcy, Wall Street Journal reported.
The owner of Regal Cinemas, Cineworld, operates 747 theaters worldwide and acquired the Regal chain in 2018 for $3.6 billion.
Although movie-theater attendance has recovered as COVID-19 fears phase out, ticket sales still lag behind their pre-pandemic levels.
Theaters are also hit by sparse content as some Hollywood studios have limited production, delayed releases, or gone straight to online streaming.
Related: Cineworld Shares Plummet On Reports Of Bankruptcy Filing: What We Know So Far.
UK-based Cineworld has more than $5 billion in debt and faces a roughly $1 billion legal judgment from a failed merger with Canadian cinema chain Cineplex Inc.
Cineworld expects to deleverage its balance sheet while seeking concessions from landlords and continuing its theater operations uninterrupted.
The company said it has commitments from its lenders for a roughly $1.94 billion loan to carry it through the restructuring process and cover operating expenses.
Cineworld Chief Executive Mooky Greidinger acknowledged in an interview with The Wall Street Journal last year that AMC had found a powerful capital-raising advantage through its meme-stock status.
Cineworld said it doesn't expect to be delisted from the London Stock Exchange due to the chapter 11 filing.
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