Theater advertiser National CineMedia files for bankruptcy protection (updated)

National CineMedia

12/04/2023 04:31

(Updates with details, background)
       April 11 (Reuters) - National CineMedia Inc  NCMI.O ,
the biggest movie-theater advertising business in North America,
said on Tuesday it filed for bankruptcy protection and had
entered into a restructuring agreement with its lenders.
    This adds to the growing list of challenges facing the
cinema industry, which has been hit hard by the pandemic and a
lack of major film releases, and follows a similar move by
Cineworld, which filed for U.S. bankruptcy protection in
September. 
    In an effort to de-leverage its balance sheet, NCM said it
entered into an agreement with its secured lenders to convert
its debt into equity. The company will receive an ownership
interest of about 14% in the restructured entity, it said. 
     Despite some progress in post-pandemic recovery, industry
executives have cautioned that the sector is still a long way
from returning to its pre-pandemic heights, with theaters and
studios facing significant disruptions in production and
attendance.
    "Today's transactions will position us to deliver the strong
results our advertisers and cinema partners have come to expect
from us today and well into the future," Tom Lesinski, the chief
executive officer of NCM said in a statement. 
      The court filings in Texas showed that NCM listed its
assets in the range of $500 million to $1 billion and
liabilities in the range of $1 billion to $10 billion.
    The development comes after AMC Entertainment Holdings Inc
 AMC.N  disclosed late on Monday that it had acquired a large
stake in the cinema advertising platform, making it the second
largest shareholder of NCM.
    As part of the Chapter 11 filing, the company sought "first
day" motions that, when granted, would enable day-to-day
operations to continue as usual. The company expects to report a
44.4% increase in revenue to $91.7 million for the fourth
quarter.

 (Reporting by Akriti Sharma in Bengaluru)
 ((Akriti.Sharma@thomsonreuters.com;))