By Scott Kanowsky
Investing.com -- Shares in Cineworld Group (LON:CINE) rallied on Monday, gaining back more than a sixth of their value, on a media report that Vue International had secured the financial backing to pursue a takeover bid of its ailing rival.
Sky News reported that Vue - Europe's largest privately-owned movie theater chain - has agreed to receive capital for a strategic acquisition from funds managed by Barings and Farallon Capital Management.
Vue is set to deliver its purchase offer ahead of a deadline set by Cineworld's advisors later this week, Sky News added.
Cineworld previously said in January that it would start a "marketing process" for a possible "value maximizing transaction" for the group's assets. The move came after the company, which was heavily impacted by pandemic-era restrictions, filed for bankruptcy protection in the U.S. and began auctioning off pieces of the business.
Despite the spike in shares today, Cineworld has seen its stock price plummet by nearly 90% over the past one-year period.