Village Roadshow secures $70 million lifeline
Village Roadshow has secured a further $70 million in funding from its banks and the Queensland government as coronavirus pandemic-related restrictions continue to put financial pressure on the family-run business.
The theme park and cinema operator, which is in exclusive takeover talks with private equity firm BGH Capital, told the ASX on Thursday that it was still losing money despite re-opening Sea World and Warner Bros Movie World. It said that the new funding from the lenders and the Queensland Treasury Corporation would be used to keep the business operating over the next 12 months.
The company’s theme parks were given the go-ahead to reopen at 50 per cent capacity after three months in June. The restrictions, which forced the company to close the parks, wiped about 80 per cent off the company’s value and pushed its shares down to a near-decade low of 77 cents.
Village, which had net debt of $280 million at the end of the last financial year, also announced a $35 million shareholder equity raise on Thursday to improve liquidity. The raise needs to be completed by February next year or, in the event a deal with BGH does not occur, three months after termination of a transaction.