Cineworld (LON: CINE) share price has been trading sideways since the company filed for bankruptcy. Cineworld cinemas is currently the second-largest Cinema operator in the world. The company had to file for chapter 11 bankruptcy in September 2022. Since then the British Cinema operator is looking for a potential buyer.
According to recent Cineworld bankruptcy news, its US subsidiary Regal Cinemas is closing 39 theaters across the country. The company expects a cost saving of $22 million per annum by this move. As per Cinewrold, the company has been facing a decline in Cinema attendance since the start of Covid-19.
Another reason impacting the sales of global cinema operators is a rise in home entertainment alternatives. The intends to pay off its liabilities by selling all of its assets to a potential buyer. Cineworld cinemas have said that multiple parties have approached the company for a potential acquisition.
Recently, the lenders of Cineworld have proposed a debt-for-equity swap scenario to the company. Such a move would allow the movie theatre operator to continue its operations amid bankruptcy proceedings.
As per recent speculations, the rival company Vue International is considering taking over the British operator. Cineworld stock price has seen a positive price action due to these rumors and the price increased by 20% on Monday. Vue International is the largest privately owned Cinema operator in Europe. According to Sky News, Vue shareholders have given it a go-ahead for the takeover of Cineworld.
Since filing for Chapter 11 bankruptcy, Cineworld share price has been very volatile. The price appears to be range bound between 2 GBX and 9 GBX levels. On Tuesday, the price increased by 3.89% and is now trading at 5.18p. LON: CINE price appears to be struggling to break above 6 pennies.
This week’s release of CPI data is likely to increase the volatility in US & UK equity markets. In case of low inflation numbers and an official takeover announcement from Vue, Cineworld stock could surge. Nevertheless, our outlook for Cineworld would remain bearish as long as the price stays below the 200-day moving average.
This post was last modified on Feb 14, 2023, 11:59 GMT 11:59