The Vue International cinema chain has had its valuation slashed by approximately half, according to a report from The Times.
The valuation has been almost halved to £650m ($785m/€771m) in a restructuring deal that also allows the chain to be protected from a €130m legal claim in Germany, and the injection of new funds into operations.
Vue is run by chief executive Tim Richards and the £1bn financial restructuring will see the company’s lenders take control of the business and remove its previous majority owners, Canadian pension funds Alberta Investment Management Corporation and Omers.
The deal further allowed its debt to be written off.
The COVID-19 pandemic and poor ticket sales have impacted Vue’s valuation, which was an estimated £2bn in 2019 when the cinema chain enjoyed a record year.
Vue suffered during the pandemic thanks to various lockdowns in the UK and hesitation from studios when it came to the release of big budget films like James Bond’s ‘No Time to Die’.
In July last year, when a number of countries removed restrictions, cinema ticket sales were still down 81% according to reports.
In the spring of this year, it was reported that cinema ticket sales were still down by 50% compared to pre-pandemic levels.