Cineworld shares plummet after cinema giant fined $1bn for aborted takeover deal

The company — which operates one cinema complex in Ireland — says it will appeal the decision.

Cineworld Dublin, on Parnell Square.

Shares in Cineworld plunged as much as 40% after a court ordered the world’s second-largest cinema chain to pay nearly $1bn (€890m) in damages — more than its entire market value — over an aborted takeover bid.

Canadian court ordered the British company — which operates one cinema complex in Ireland — to pay the money after it scrapped a plan to buy Toronto-based Cineplex as the pandemic forced entertainment venues to close. The $1.6bn deal would have made Cineworld North America’s largest cinema operator.

Cineworld’s market value has shrunk by about 90% in the past two years, and now stands at about £400m (€470m) after an acquisition spree and Covid-mandated theatre closures swelled its debt burden to about $5bn.

The company will appeal the decision and does not expect to have to pay damages during this process, which a spokesman said could take up to a year.

Bloomberg and Irish Examiner