CMX Files Chapter 11 Amid Theater Shutdowns
CMX Cinemas, the eighth-major U.S. movie theater operator, has submitted Chapter eleven bankruptcy only a thirty day period following it named off its proposed acquisition of Texas chain Star Cinema Grill.
CMX cited the economic disaster precipitated by the coronavirus pandemic that has shuttered theaters in the course of the U.S.
“We are in a condition of complete uncertainty as to when we can re-open up our theaters and when our clients will experience harmless and safe in returning to them supplied that there is presently no vaccine versus the virus,” the U.S. subsidiary of Mexico’s Cinemex said in a assertion. “We simply cannot forecast when — if at any time — buyer quantities will return to pre-disaster amounts.”
The acquisition of SCG, which operates dine-in theaters, would have created CMX the seventh-major U.S. theater chain. In terminating the deal, CMX said on March 26 that “in light of COVID-19 relevant fallout” it was not needed to close the transaction.
The Chapter eleven submitting arrived soon right before a hearing in SCG’s lawsuit looking for a court docket get that would compel CMX to close the deal. CMX has requested the bankruptcy court docket to impose an computerized keep on those proceedings.
“In a Chapter eleven it is difficult to see how CMX could be compelled to go through with the SCG acquisition,” Celluloid Junkie famous.
Because coming into the U.S. current market in 2017, CMX has built a chain with more than 3,000 screens in 104 U.S. cities. In announcing the deal on March sixteen, it said the SCG acquisition was a “perfect fit” and would bolster its “robust growth programs in the U.S.”
SCG submitted its match April two, alleging CMX was using the coronavirus disaster as a pretext for backing out of the deal.
“Far from getting unforeseen, the possible impact of the coronavirus was a important factor talked about by the events through their negotiation of the arrangement,” the match said. “There is no doubt that Cinemex entered into the arrangement with its eyes broad open up to the pandemic and its possible effects.”
Aaron Davidson/Getty Photographs for CMX Cinemas