Cinedigm Shares Plunge After Borrowing Deal Unveiled

cinedigm LOGO

Wall Street has given a chilly response to Cinedigm’s disclosure of a private $60 million borrowing deal.

Shares hit an all-time low in trading Thursday, declining 33 cents to 93 cents in mid-session. Two years ago, the stock hit an all-time high at $3.06 a share.

The convertible senior notes are due in 2035. Cinedigm plans to use $18.2 million of the proceeds from the offering to repay borrowings and terminate its term loan. It will use the rest of the net proceeds to fund repurchasing shares of its common stock.
Cinedigm warned that the transaction could impact its stock price, noting that debtholders could short the stock.
“The forward stock purchase transaction is generally expected to facilitate privately negotiated derivative transactions between the forward counterparty and holders of the notes, including swaps, relating to our shares of the Company’s common stock by which holders of the notes will establish short positions relating to the Company’s common stock and otherwise hedge their investments in the notes concurrently with, or shortly after, the pricing of the notes,” it said.

Cinedigm Corp. last reported earnings in February, disclosing a 32% jump in revenues to $31.3 million for its third quarter, which ended Dec. 31 from the prior quarter. The company, which is launching ConTV and the Dove Movie Channel, reported a 27% rise in adjusted EBITDA of $15.7 million and announced it had signed new distribution deals for 74 original, cast-driven films with partners including the Asylum, American International Pictures, Great Point Media, Brand Entertainment and Moguldom.

Filed Under:

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 2

Leave a Reply


Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

  1. Ja nie mam większego problemu z dekorowaniem zewnętrznych stron okien, gdyż
    okna mojego domu są przed deszczem chronione okiennicami.

  2. Undeniably believe that that you stated.
    Your favorite justification seemed to be on the internet the easiest thing to have in mind of.
    I say to you, I certainly get irked even as people consider concerns that they plainly do not realize about.
    You managed to hit the nail upon the top and outlined
    out the whole thing without having side effect , folks could take a signal.
    Will likely be again to get more. Thank you

More Film News from Variety