Cineworld, the world's second-largest cinema operator, is looking to sell its UK operation as part of a strategic review that could lead to a wholesale restructuring of its business.
Reports in Sky News reveal that Cineworld is working with advisers on a potential disposal of its UK business after its parent company went through a series of insolvency processes last year.
It says the brand has started contacting prospective bidders, drafting in restructuring advisor AlixPartners to work on the process – the same firm that handled the administration of its London-listed holding company.
Sky News added that the cinema chain is expected to explore the option of a company voluntary arrangement: a restructuring vehicle used by companies allowing a proportion of its debts to be paid back over time.
But the method is contentious with landlords, with some arguing that it disproportionately hits landlords through rent reductions, writing off arrears and site closures.
The sale process is expected to take several weeks, according to Sky News, which says a number of firms are likely to examine offers for the brand, including rival operator, Vue.
It reported last year that Vue had gathered backing for a takeover of Cineworld, but was frozen out of a process that was eventually abandoned. A Cineworld spokesperson told Sky News: "Like many businesses, we are continually reviewing our UK operations."
A sale of the cinema giant's UK business is likely to better suit landlords than a CVA, with leisure experts previously telling CoStar News that cinemas are often hard to convert and could be left empty, should the brand shut some locations.
CoStar data shows that Cineworld has around 130 sites in the UK, including its Picturehouse Cinema sites, comprising a total property footprint of around 4.7 million square feet.
Landlords previously identified as hosting Cineworld cinemas include major British REITs Landsec and institutional investor the Tesco Pension Trust, with the duo owning venues in Wandsworth in London and Glasgow respectively.
Other firms which lease properties to Cineworld include British Land, Aviva Investors Global and M&G Property, while the Crown Estate, Legal & General and several local authorities also rent lease buildings to Cineworld and are likely to keep tabs on any potential sale.
Cineworld filed for administration in the US at the end of July last year after, successfully emerging from Chapter 11 bankruptcy after nearly 11 months. The group said its actions would "transform the group's balance sheet and provide it with significant additional liquidity to fund its long-term strategy".
It also suspended its listing on the London Stock Exchange and appointed several new directors to its board, including Ann Sarnoff, the former chair and CEO of Warner Bros, and a former senior executive at BBC Studios.