Mexico’s Cinepolis Reaches Restructuring Deal for Bank Loans

Michael O'Boyle
·2 min read

(Bloomberg) -- Cinepolis de Mexico SA, Mexico’s biggest chain of cinemas, has struck a deal with its banks to restructure more than $1 billion of loans and receive $300 million directly into the company, people familiar with the talks said.

Banks including Banco Bilbao Vizcaya Argentaria SA, Banco Santander SA, HSBC Holdings Plc, and Bank of America Corp. agreed to provide an additional $200 million to help Cinepolis recover from the pandemic after the company’s controlling family offered to put up $100 million, said the people, who asked not to be identified as the details are private. The new financing is being split between most of the banks holding more than $1 billion in debt combined.

Cinepolis declined to comment. HSBC also declined to comment and the other banks did not immediately respond.

Owned by the Ramirez family, Cinepolis borrowed heavily to fuel a global expansion during the last decade of its luxurious cinemas with expanded legroom and cocktails. As of last year, it had 862 theaters across 17 countries.

Cinemas were crippled by the pandemic, but the roll out of vaccines is improving the outlook for Mexico, the U.S. and Spain, three of Cinepolis’ top markets where theaters are opening up to limited capacity. Hollywood studios delayed major releases or have opted to immediately stream new films, and industry insiders fear box office receipts may never recover to levels before the pandemic levels.

Cinepolis debt includes a 7.5 billion peso ($382 million) term loan due 2023, a $200 million revolver due 2024 and 9.75 billion peso guaranteed term loan due 2026. Combined with obligations tied to operations in India, Brazil and the Middle East, the talks cover $1.35 billion of debt from at least 17 banks, one of the people said.

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