Cineworld Shares Muted Despite Freezing Vue From Sale Process

The Cineworld Group plc (LON: CINE) share price barely moved despite rumours that it has frozen its London rival Vue International from the ongoing sale process. The news comes after earlier reports indicated that Vue had secured the necessary backing to make an offer for Cineworld.

If the rumours are true, they would indicate that Cineworld is not keen to combine its operations with Vue’s, which I have highlighted in the past. The Greidinger brothers, who run Cineworld, have always wanted to keep the company intact after the bankruptcy process ends. However, Cineworld’s creditors have a different perspective.

Cineworld's last update regarding the ongoing auction of its assets revealed that it had received multiple offers for some of its assets. Still, none of the bidders was interested in acquiring the entire company. Instead, many bidders were interested in acquiring Cinewrold’s Eastern European assets, which it might eventually sell. 

Therefore, the movie theatre chain has to rethink its current strategy if it wants to dispose of some of its assets since, apart from Vue, nobody else has expressed interest in acquiring the company’s entire portfolio of movie theatres in the UK and other countries. 

Sky News, which broke the news about Cineworld sidelining Vue, reported last week that the founder of Picturehouse, a cinema chain acquired by Cineworld, would love to repurchase it and was in talks with Vue about the same. While Vue has the financial backing to acquire all of Cineworld, it will most likely sell some of its assets. 

Other companies that had expressed interest in Cineworld’s shares include Canada’s Cineplex and AMC Entertainment, which were keen to acquire the company’s US division, Regal Cinemas. However, none of the two firms submitted bids in the ongoing sale process, whose deadline was extended to 10 April 2023. 

Again, Cineworld might have frozen out AMC Entertainment and Cineplex from making bids for Regal Cinemas, given that the company’s goal is to remain intact after the bankruptcy process ends. Cineworld will only sell any of its assets if its creditors insist. 

*This is not investment advice. 

Cineworld share price. 

The Cineworld share price edged 3.89% to trade at 2.40p, from Thursday’s closing price of 2.31p.