Cineworld hands £190m to investors shaken and stirred by Regal takeover

CINEWORLD has agreed to hand over nearly £190m to investors who claim they were underpaid during the firm’s takeover of Regal Entertainment.

The British cinema chain bought its US rival for £2.6bn or $23 a share in 2017.

The group massively expanded its reach into North America, adding 561 Regal cinemas to its business.

But the deal soon faced criticism from investors who claimed bosses at Regal had not done enough to get shareholders a good deal.

A lawsuit filed a year afterwards alleged that the takeover ensured senior executives received ‘significant and immediate benefits while the company’s shareholders cashed out an unfair price’. Cineworld yesterday said it had reached agreement with these dissenting shareholders. It will pay £122.6m to them immediately, with up to £66.3m more due to be paid by March 31 depending on final calculations of interest. The £188.9m payout is a blow to Cineworld at a time when it is already grappling with financial woes brought on by the pandemic. After many months of forced closures due to pandemic lockdowns, the company is nursing a debt pile of more than £6bn. The company, which is led by Mooky Greidinger (left), has had to raise cash from investors multiple times during the Covid-19 crisis just to survive, and is even considering floating its Regal business in the US to raise further funds.

In its latest results, Cineworld also warned that there was ‘no certainty around the recovery from Covid-19 in the short term’.

Like rivals, however, it now hopes a string of blockbuster films set for release in the final months of 2021 will tempt audiences back to the big screen, including James Bond film No Time To Die (which stars Cuban actress Ana de Armas, right, alongside Daniel Craig as 007), Marvel superhero film Eternals, Denis Villeneuve’s adaptation of the sci-fi classic Dune and the fourth instalment of the popular Matrix franchise, The Matrix Resurrections, starring Keanu Reeves and Carrie-Anne Moss.

Cineworld shares dipped 1.1pc, or 0.68p, to 62p after the announcement.