# Cineworld gets US court approval to raise $2.26 billion after bankruptcy Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-05-03 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Cineworld secures $2.26 billion post-bankruptcy financing Meta Description: Cineworld receives court approval to raise $2.26 billion post-bankruptcy, aiming to emerge debt-free in 2023 with $1.46 billion loan and $800 million in equity URL: https://financedigest.com/cineworld-gets-us-court-approval-to-raise-2-26-billion-after-bankruptcyhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-05-02t215709z2lynxmpej410vkrtroptp4cineworld-grp-restructuring-1736814075517-compressed.jpg) By Dietrich Knauth (Reuters) – Bankrupt movie theater chain Cineworld received U.S. court approval on Tuesday to [raise $2.26 billion](https://www.financedigest.com/ev-maker-rivian-prices-ipo-above-range-to-raise-over-11-9-billion.html "EV maker Rivian prices IPO above range to raise over .9 billion") as part of its exit from [bankruptcy,](https://www.financedigest.com/court-oks-mallinckrodt-restructuring-1-billion-cut-to-opioid-settlement.html) after reaching a settlement with a minority faction of [lenders](https://www.financedigest.com/turf-wars-consumer-attitudes-towards-established-and-alternative-lenders.html) that had opposed parts of the exit financing. Cineworld is aiming to [emerge from Chapter 11 bankruptcy](https://www.financedigest.com/revlon-emerges-from-bankruptcy-after-lender-takeover.html "Revlon emerges from bankruptcy after lender takeover") in the first half of 2023, with a proposal to cut $4.53 billion in debt, wipe out existing shareholders and transfer ownership of the company to its lenders. U.S. Bankruptcy Judge Marvin Isgur at a hearing in Houston approved Cineworld’s plan to fund its post-bankruptcy operations with a new $1.46 [billion loan](https://www.financedigest.com/trafigura-enters-3-billion-loan-to-supply-germanys-sefe-with-gas.html "Trafigura enters billion loan to supply Germany’s Sefe with gas") and the sale of $800 million in new equity shares. Cineworld is scheduled to seek final [court approval](https://www.financedigest.com/australian-court-approves-bhps-6-4-billion-oz-minerals-takeover.html "Australian court approves BHP’s .4 billion OZ Minerals takeover") of its bankruptcy restructuring on June 12. Isgur approved the financing after Cineworld announced a last-minute settlement that resolved objections raised by minority [lenders including Jefferies Leveraged Credit](https://www.financedigest.com/credit-chameleons-lenders-must-tune-in-to-changing-customer-attitudes.html "Credit Chameleons – Lenders must tune in to changing customer attitudes"), Glendon Capital Management and Greywolf Capital. I came out here not [knowing whether we were going to have a fight or a deal,”](https://www.financedigest.com/ma-deals-what-tech-startups-need-to-know.html "M&A deals: what tech startups need to know") Isgur said. The settlement [resolved a dispute](https://www.financedigest.com/russias-sberbank-urges-glencore-to-resolve-dispute-over-oil-bill.html "Russia’s Sberbank urges Glencore to resolve dispute over oil bill") over the amount of new stock that Cineworld’s lenders would receive for backstopping the exit financing. Under Cineworld’s earlier proposal, a majority faction of lenders, which includes Blackstone Alternative Credit Advisors, Carlyle Investment Management and Sixth Street Partners, would have received 27% of the company’s new equity shares simply for agreeing to [support the exit financing package that they themselves engineered](https://www.financedigest.com/engineering-pipe-hanger-and-support-market-estimates-the-to-expand-at-around-4-8-cagr-from-2021-to-2031-2.html "Engineering Pipe Hanger and Support Market Estimates The To Expand At Around 4.8% CAGR from 2021 to 2031"), according to the objecting lenders. The settlement reduces the backstop premium to [11% of the new equity shares](https://www.financedigest.com/shares-in-uk-chain-sainsburys-jump-11-on-report-of-buyout-interest.html "Shares in UK chain Sainsbury’s jump 11% on report of buyout interest"), providing the minority lenders with about $38.5 million in additional value, Cineworld attorney Joshua Sussberg said in court. The new agreement is now [supported by over 99% of Cineworld’s lenders](https://www.financedigest.com/leading-credit-reference-agencies-launch-industry-wide-information-notice-to-support-lenders-and-consumers-in-gdpr-world.html "Leading credit reference agencies launch industry-wide information notice to support lenders and consumers in GDPR world"), Sussberg added. [Cineworld filed](https://www.financedigest.com/movie-chain-operator-cineworld-files-for-u-s-bankruptcy.html "Movie chain operator Cineworld files for U.S. bankruptcy") for U.S. bankruptcy protection in September to try to [restructure its debt](https://www.financedigest.com/sri-lanka-to-unveil-debt-restructuring-plan-to-creditors.html "Sri Lanka to unveil debt restructuring plan to creditors"). It attributed its [financial troubles to the lingering impacts of the COVID-19](https://www.financedigest.com/how-covid-19-paved-the-way-for-risky-financial-experimentation.html "How Covid-19 paved the way for risky financial experimentation ") pandemic, which halted production of major blockbusters, forced theaters to temporarily close, and shifted consumer habits toward watching movies via online streaming platforms. It initially sought to [sell some or all of its business](https://www.financedigest.com/t-mobile-sells-wireline-business-to-cogent-for-1-expects-hefty-charge.html "T-Mobile sells wireline business to Cogent for , expects hefty charge"), but pivoted to a debt restructuring plan after failing to find a buyer. (Reporting by Dietrich Knauth, Editing by Alexia Garamfalvi and David Gregorio) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---