Cinema advertising giant National CineMedia said today that its reorganization plan has been confirmed by a judge in the United States Bankruptcy Court for the Southern District of Texas.
The company filed for Chapter 11 in April. It is now expected to appear in August or September.
The plan allows the company to eliminate debt and emerge with a significantly stronger balance sheet. It will maintain its existing corporate structure, with publicly traded National CineMedia serving as manager of NCM LLC. Existing management led by CEO Tom Lesinki will continue to lead the reorganized company.
It intends to enter into an exit financing facility of approximately $55 million, which will be used to fund operations and growth initiatives.
“Today’s announcement marks a major step forward in our financial restructuring, positioning the Company for long-term success,” said Lesinski. “As we move forward at the show, we will continue to offer our full channel of advertising solutions, connecting brands with NCM’s young, diverse and demanding film audience. We express our appreciation to our employees, customers and partners for their unwavering support throughout this process and are excited to continue our work together in the future.”
NCMI serves over 19,500 screens in more than 1,500 theaters, including the three largest national chains. AMC, Regal and Cinemark – which remain major shareholders. It tangled, then settled, with Regal during Cineworld’s bankruptcy for a long-term deal with the giant exhibitor.
Shares jumped nearly 6% to about 31 cents. The company’s very low share price over the months has put its Nasdaq listing at risk. Last week, the company announced plans for a reverse stock split, which would boost the stock price. A stock falls outside the stock exchange’s minimum listing requirements if it trades below $1 for 30 consecutive days. National Cinemamedia was recently given until July 26 to come into compliance.