Add to balance / Manage account | User: | Log out |
Prospect News home > News index > List of issuers N > Headlines for National CineMedia LLC > News item |
Cineworld seeks exercise of redemption rights in National CineMedia
Chicago, Dec. 21 – Cineworld Group plc is seeking relief from the court in the form of authorization to exercise its contractual redemption rights in National CineMedia, LLC, according to a motion filed with the U.S. Bankruptcy Court for the Southern District of Texas.
National CineMedia is a member-managed limited liability company formed by debtors associated with the case, Regal CineMedia Holdings, LLC and Regal Cinemas, Inc., with other major cinema chains.
National CineMedia is a nationwide advertising platform and the Regal debtors own 23.7% of the equity interests in the platform.
The Regal entities have the unilateral right to redeem the existing equity interests in National CineMedia for either cash or stock at National CineMedia’s option.
National CineMedia itself may have to restructure in the near term. In a press release covering a downgrade, Moody’s Investors Service said in October that the company was in high likelihood of a covenant breach as soon as March 2023 and has two almost fully drawn revolvers maturing in June 2023.
Should National CineMedia need to restructure, Regal could face adverse tax consequences due to the substantial cancellation of debt income.
Cineworld finds that the tax cost associated with the exercise of the redemption rights would be less burdensome than the potential future tax consequences in the other scenario.
A hearing will be held on Dec. 23.
Cineworld is a London-based cinema operator. The company filed bankruptcy on Sept. 7 under Chapter 11 case number 22-90168.
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.