Things are looking up significantly for the US’s second-largest movie theater chain. With the rocky road of post-COVID recovery still a reality for most theatrical chains, a full industry recovery has been elusive. Last week, news broke that they have secured a further loan to set towards refinancing as well as needed theater renovations. Our local industry expert, entertainment attorney at Blake & Wang P.A., Brandon Blake, unpacks what this means for the theater chain.
$1.9B Loan for Refinancing
The hefty loan was secured mostly on the backs of the $1B-strong theatrical takings and a 49M strong audience from Regal locations over the last quarter. This loan will form part of their ongoing refinancing efforts, due in December 2031. Additionally, they will have access to a $350M revolving credit option. The loan was overseen by global financial giants such as JP Morgan, Wells Fargo, Deutsche Bank, Barclays, and Texas Capital.
In July this year, the chain secured a further $250M in funding, primarily targeted at luxury upgrades for 425 of its locations. Things are looking a whole lot better for them than they did last year, when they entered Chapter 11 bankruptcy in September 2024. They have now fully emerged from the necessary restructuring process.
Positive Market Reaction
The deal, which is earmarked to reduce their annual interest bill by $60M, has been generally well received by the markets. It couldn’t have better timing, either, as the domestic box office has had a bumper quarter and one of the best Thanksgiving weekends (no, actually, the best) on record, significantly closing the lag with last year’s box office. Cinemark itself announced the second-best November box office for the chain on record.
It’s always good to see the theatrical industry thrive. Regal managing to reposition itself from the brink of bankruptcy in just over a year is positive indeed. Let’s hope this latest refinancing round will power them to new successes in the future, too.
