A restructuring deal for part of UK cinema chain Vue’s £700 million debt will see a group of lenders take over the chain. The lenders are led by Barings LLC and Farallon Capital Management LLC. Vue has 228 sites across nine European countries. The chain made huge losses during the COVID-19 pandemic lockdowns and even after cinemas reopened, thanks to delayed film releases and necessity of observing COVID-19 protocols.
The lenders will swap a portion of the debt they own in the company for equity. As part of the agreement, the company will convert £465 million debt into equity and receive a cash injection of £75 million to cover a funding gap which is expected later this year. The new amount of money will be structured as a super senior term loan.
The group of lenders includes Invesco Ltd., PGIM Investments LLC, and Lord Abbett & Co. LLC.