The daily business briefing: September 8, 2022
Regal Cinemas parent company Cineworld files for bankruptcy protection, Kim Kardashian launches a private equity firm, and more
Cineworld, owner of Regal Cinemas, files for bankruptcy protection
Regal Cinemas owner Cineworld Group on Wednesday filed for bankruptcy protection in federal court in Houston, blaming weak ticket sales. Movie theater admissions rebounded somewhat as COVID-19 restrictions were lifted, but they haven't returned to pre-pandemic levels. Cineworld is the world's second-largest movie theater chain behind AMC Entertainment Holdings. It operates 751 movie theaters, more than 500 of them in the United States. Its stock has fallen since early this year as audiences were slow to return. "Traveling to a movie theater to watch a movie for two to three hours, and spending $20 to $25, is just not attractive anymore for a lot of people, especially young people," said Eric Snyder, a bankruptcy expert at Wilk Auslander.
Kim Kardashian launches private equity firm with former Carlyle executive
Kim Kardashian is partnering with longtime Carlyle Group executive Jay Sammons to form a private equity firm, SKKY Partners. Kardashian's mother, Kris Jenner, will participate in the firm as a partner. Kardashian, a reality TV star, is the latest in a string of celebrities to get into private equity investing. SKKY said in a statement that it "will make both control and minority investments in growth-oriented, market-leading consumer and media companies," tapping into Sammons' financial experience and Kardashian's "global reach and unrivaled social influence" to identify investment opportunities. Sammons' past deals include Beats by Dre and streetwear brand Supreme. Kardashian has launched an underwear company, Skims, which has a $3.2 billion valuation.
E.U. proposes Russia gas price cap, Putin threatens cutoff
The European Union on Wednesday proposed capping Russian gas prices, escalating a fight with Moscow over energy supplies. Russian President Vladimir Putin has threatened to cut off all Russian energy supplies to Europe in response to any price cap. The clash threatened to drive up already high European gas prices, and increased the potential for rationing in European countries this winter. Europe has accused Russia of using energy shipments to punish Western nations for imposing sanctions over Russia's invasion of Ukraine. Russia claims the sanctions created the energy crisis by preventing adequate maintenance of the Nord Stream 1 natural gas pipeline, a key conduit to Europe. E.U. energy ministers have scheduled an emergency meeting for Friday.
Judge says Musk can add whistleblower claims to Twitter countersuit
Chancellor Kathaleen St. Jude McCormick, head judge of Delaware's Court of Chancery, said Wednesday that Tesla CEO Elon Musk can amend his countersuit against Twitter to include recent whistleblower allegations by the social media company's former security chief. Ex-head of security Peter Zatko, who was fired by Twitter earlier this year, filed a whistleblower complaint saying the company has failed to protect sensitive user data and prevent fake accounts. Musk is trying to back out of a $44 billion deal to buy Twitter. He says the company has not satisfied his demand to know how many of Twitters users are bots. Twitter is suing to force him to go through with the acquisition. McCormick denied Musk's request to delay the trial to November from Oct. 17.
Stock futures flat after Wednesday's surge
U.S. stock futures were little changed early Thursday after Wednesday's big gains. Futures tied to the Dow Jones Industrial Average, the S&P 500, and the Nasdaq were up 0.1 percent at 7 a.m. ET. The Dow and the S&P 500 rose 1.4 percent and 1.8 percent, respectively, on Wednesday. The tech-heavy Nasdaq jumped 2.1 percent, snapping a seven-day losing streak. It was the best day since Aug. 10 for all three of the main U.S. indexes. On Thursday, investors will be watching a question-and-answer session with Federal Reserve Chair Jerome Powell for indications about the central bank's views on the state of the economy and its plans for continuing aggressive rate hikes to fight inflation.