The Cineworld Group, the second largest cinema group in the world, has filed for bankruptcy in the US as the debt-laden business seeks time to restructure, bosses have revealed.

The company said it had filed for Chapter 11 – a form of US bankruptcy that businesses often use when they plan to bounce back from their current problems.

It is designed to allow the debt-ridden chain the chance to bounce back from its current woes, caused in part by the pandemic and a lack of popular recent films.

Chief executive Mooky Greidinger said: “The pandemic was an incredibly difficult time for our business, with the enforced closure of cinemas and huge disruption to film schedules that has led us to this point.”

Although sounding dramatic, Chapter 11 bankruptcies are quite different from other forms of declaring that a business has gone bankrupt. They mean the company will be able to hold on to all its assets and trade as normal for the time being.

That will be reassuring news, in the short term, for people visiting and working at Cineworld in Broughton, which is currently the closest cinema in the Chester area.

It is also planned for Picturehouse, which Cineworld owns, to open a cinema as part of the new Northgate Development.

Last month, Cheshire West and Chester Council released a statement to confirm that work was still ongoing to fit out the cinema, and the local authority was "monitoring the situation".

Cineworld said it plans to emerge from bankruptcy in the first three months of next year. It is “confident that a comprehensive financial restructuring is in the best interests of the group and its stakeholders, taken as a whole, in the long term”.

But it will be painful for shareholders, whose positions in the business are likely to be heavily diluted during the process. Its shares will still keep trading in London, Cineworld told investors.

It follows reports last month that the British-based firm is considering the move after struggles to rebuild attendance following the Covid pandemic.

Cineworld had previously warned audience numbers have been weaker than expected and predicted they will stay low until November due to “limited” film releases.

The company added: “Cineworld and its brands around the world – including Regal, Cinema City, Picture House and Yes Planet – are continuing to welcome customers to cinemas as usual, which will not change during the Chapter 11 cases.

“The group expects to continue to honour the terms of all existing customer membership programmes, including Regal Unlimited and Regal Crown Club in the United States and Cineworld Unlimited in the UK.”