Cinepolis Enlists Lazard to Save Its Global Web of Posh Cinemas
(Bloomberg) -- Cinepolis de Mexico SA, Mexico’s biggest chain of cinemas, is seeking to restructure more than $1 billion in loans, people familiar with the talks said.
The global movie theater giant has enlisted Lazard Ltd. for talks with lenders including Banco Bilbao Vizcaya Argentaria SA, HSBC Holdings Plc, Banco Santander SA and the Mexican government development bank Bancomext, the people said. Talks started early last month and the banks picked FTI Consulting Inc. as their adviser, said the people, who asked not to be identified as the details are private.
Representatives for Cinepolis and HSBC declined to comment, while those for Lazard, FTI and the other banks did not immediately respond to requests for comment.
Some of the debt includes a 7.5 billion peso ($382 million) term loan due 2023, a $200 million revolver due 2024 and 9.75 billion peso guaranteed term loan due 2026. Combined with obligations tied to operations in India, Brazil and the Middle East, the talks cover $1.35 billion of debt from at least 17 banks, one of the people said.
With vaccines rolling out, bankers are more willing to help the family-owned chain survive, the people said. Cinepolis, whose luxury theaters feature extended legroom and serve handcrafted cocktails, has a better chance than some of its peers with higher leverage that have already been restructured, one of the people said.
Competitors have grappled for financing wherever possible, as a series of global lockdowns have kept moviegoers at bay, and the rise of streaming services has provided an attractive alternative at home. AMC Entertainment Holdings Inc., the world’s largest movie theater chain, is in talks to raise new money backed by its European cinemas to help it avert bankruptcy, while London-based Cineworld Group Plc obtained a rescue loan from existing creditors in November.
Cinepolis, which has locations in the U.S., Spain, India and Brazil, has borrowed over the years to fund a global expansion of high-end cinemas, which have been crippled by the pandemic. It had 862 theaters across 17 countries as of October, according to a company presentation.
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