Regal Rockville to Remain Open Per Report

Back in January, Regal Cinemas has announced plans to close 39  U.S. theaters, including its location at 199 E Montgomery Ave in Rockville, according to a report  by Business Insider. Yesterday, PoPville reported that Regal in Rockville be among theaters that will remain open under NewCo (formerly Cineworld).

Regal Rockville opened on November 6, 1998. In January, Business Insider reported that Cineworld, the parent company of Regal that filed for Chapter 11 bankruptcy in 2021, plans to “reject the leases” of the 39 locations starting February 15.  The company expected the move to save them close to $22 million a year and “the debtors are hopeful that these negotiations will lead to lease concessions and modifications that will obviate the need for rejection and enable additional theater sites to remain open.” Cineworld, however has confirmed plans to emerge from Chapter 11 cases as NewCo. Additional information in the press release below:

Cineworld (together with its subsidiaries, the “Group”) and certain of its subsidiaries (together, the “Group Chapter 11 Companies”) announced that the United States Bankruptcy Court for the Southern District of Texas, Houston Division (the “Bankruptcy Court”) has confirmed their third amended joint chapter 11 plan of reorganisation (the “Plan”) at a hearing on 28 June 2023. This milestone paves the way for the Group Chapter 11 Companies to implement the restructuring transactions contemplated by the Plan and to successfully emerge from their chapter 11 cases, after they have satisfied certain conditions to the effectiveness of the Plan. Cineworld continues to expect to emerge from the chapter 11 cases in July 2023.

Among other things, the Plan involves the release of approximately $4.53 billion of the Group’s funded indebtedness, the execution of a fully backstopped rights offering to raise gross proceeds of $800 million and the provision of $1.46 billion in new debt financing.  As announced on 26 June 2023, it is envisaged that Cineworld Group plc (and not any of the operating companies or subsidiaries in the rest of the Group) would, subject to an order of the court in England, enter into administration shortly prior to the emergence of the Group Chapter 11 Companies from their chapter 11 cases.

As previously announced, given the level of existing debt that is proposed to be released under the Plan, there will not be any recovery for holders of Cineworld’s existing equity interests.

“The confirmation of our plan of reorganisation is a significant milestone as Cineworld moves towards emerging from this process in a strong financial position and with a more resilient capital structure,” said Mooky Greidinger, Chief Executive Officer of Cineworld. “I want to thank our incredible employees as well as our customers, vendors, lenders and other stakeholders who supported us throughout this process.  Cineworld remains focused on refining and growing our global business and cinemas for our guests around the world and delivering the most immersive and cutting-edge cinema experiences that make us the ‘Best Place to Watch a Movie.’”

As announced on 26 June 2023, it is envisaged that a newly incorporated company to be controlled by the Group’s lenders (“NewCo”) will become the sole owner of the Group upon emergence from the chapter 11 cases. In accordance with the terms of the Plan, it is expected that a new board of directors for NewCo (the “NewCo Board”) will be appointed with effect from the effective date of the Plan.

On 28 June 2023, the Group Chapter 11 Companies filed an updated supplement to the Plan (the “Plan Supplement”) with the Bankruptcy Court which, among other things, set out that the Group Chapter 11 Companies expect the NewCo Board to include Eric Foss as Chairman.

Mr. Foss has served as Chairman and CEO of two Fortune 200 companies and has extensive global business experience in the food, beverage and service industries. Mr. Foss served as CEO of Aramark from 2012 and as Chairman and CEO from 2015 until his retirement in 2019. Prior to Aramark he was Chief Executive Officer of Pepsi Beverages Company and Chairman and CEO of The Pepsi Bottling Group. Mr. Foss currently serves on the Board of Directors at Cigna, Diversey Holdings Ltd, Primo Water Company and Selina Hospitality PLC.

The selection of additional NewCo Board members is ongoing. Once selected, the Group Chapter 11 Companies will disclose the identities of additional NewCo Board members in filings with the Bankruptcy Court, in accordance with the obligations of the Group Chapter 11 Companies in connection with the Plan.

A copy of the Plan Supplement, including additional information regarding the NewCo Board, is available at the website set out below.

Business as usual

The Group continues to operate its global business and cinemas as usual without interruption and this will not be affected by the Group Chapter 11 Companies’ emergence from their Chapter 11 cases, including the entry of Cineworld Group plc into administration. The Group and its brands around the world – including Regal, Cinema City, Picturehouse and Planet – are continuing to welcome customers to cinemas as usual. The Group continues to honour the terms of all existing customer membership programmes, including Regal Unlimited and Regal Crown Club in the United States and Cineworld Unlimited in the UK.

Featured photo courtesy of @adam_brockett on Instagram.