Cineworld plans to close around 25 of its 100 British cinemas under a radical restructuring proposal.
The company also wants to renegotiate rent agreements at a further 50 sites, with the remaining 25 of its 100 sites untouched by the restructuring.
Sources told Sky News the proposals were expected to be formally outlined to creditors including rent cuts to landlords in the coming weeks.
They told the broadcaster that the insolvency mechanism employed by the cinema was expected to be a restructuring plan rather than a company voluntary arrangement (CVA).
A Cineworld spokesperson said in a statement: ‘We continue to review our options but we don’t comment on rumours and speculation.’
Last month it was reported Cineworld was holding talks about a sale with potential buyers, and that it had then switched to a formal restructuring process.
It is expected other cinema operators could step in and take over some of Cineworld’s sites if enough landlords refuse to agree to the new terms.
Cineworld’s plans to close some of its sites come after a tough few years for the company, which is the UK cinema market leader along with Odeon and Vue.
It has faced problems of people not returning to the cinema post-pandemic and instead increasingly choosing to stay at home and watch new releases on streaming services.
Families also cut back due to the cost of living crisis and instead opted for streaming services such as Disney Plus, which involved a number of films being released directly on that platform – bypassing cinemas altogether.
Cineworld grew under the leadership of the Greidinger family into a global giant of the film industry, acquiring chains including Regal in the US in 2018 and the British company of the same name four years prior.
However its multibillion-dollar debt mountain led it into crisis, and forced the company into Chapter 11 bankruptcy protection in 2022.
Filing for a Chapter 11 bankruptcy means a company intends to reorganise its debts and assets to have a fresh start, while remaining in business.
Cineworld shares were worth just 0.6p in June last year after it was hit hard by the pandemic. They were changing hands at 300p just five years ago.
It caused it to delist from the London Stock Exchange in August 2023 after its share price continued to collapse and fears were raised for its survival.
A deal was struck last year which exchanged several billions dollars of debt for shares, with a significant sum of fresh cash injected into the company by a group of hedge funds and investors.
The multinational, which includes cinema brands Regal, Cinema City, Picturehouse and Planet, also operates in central and eastern Europe, Israel and the United States.
Cineworld was devastated by pandemic lockdowns forcing it to shut down its cinemas, having already racked up enormous debts through the costly takeover of US rival Regal Cinemas in 2018.
During the pandemic, the cinema had to reduce the capacity of each cinema by around 50 per cent.
Movie start times had to be staggered to prevent the build up of too many patrons in the foyer at the one time.