Cinemark USA sets call for $405M offering of 5-year senior notes

Cinemark USA Inc. is in market today with a $405 million offering of five-year (non-call two) senior notes ahead of an investor call at 11 a.m. ET. Pricing is expected to be today's business via bookrunners Wells Fargo (left), Barclays, J.P. Morgan and RBC.

Proceeds are earmarked to fund a tender offer for the company’s 5.125% notes due 2022, which stood at $400 million as of March 4. The tender offer, which expires at 5 p.m. ET on March 11, is priced at 102.7, according to a statement this morning.

Cinemark operates movie theaters across the United States and in 15 countries in Central and South America. It is rated B/B3, with a negative outlook on both sides. Current unsecured ratings are B/Caa1.

The company has been severely impacted by the COVID-19 pandemic, which prompted the shutdown of all of its locations in March 2020. This was followed by temporary personal and salary reductions, limits on non-essential operating and capital expenditures and negotiated payment abatements with landlords and other suppliers. As of the end of 2020, the company had reopened 217 of its domestic U.S. theaters and 129 of its international theaters showing a limited number of new releases alongside library content with reduced hours and capacities.

Cinemark, however, has said it has enough liquidity to sustain operations for the foreseeable future, noting it has been able to take advantage of certain tax-related benefits under various government support programs.