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Lenders for AMC Entertainment Holdings Inc. have hired restructuring lawyers after the world’s largest movie theater-chain shut down its cinemas due to the coronavirus pandemic, WSJ Pro Bankruptcy reported. A group of lenders has hired law firm Gibson, Dunn & Crutcher LLP for advice on expected restructuring negotiations. John Fithian, the president of the National Association of Theatre Owners, previously told the Wall Street Journal that movie-theater owners both large and small face substantial risk of bankruptcy due to the pandemic. The $2 trillion rescue package that the U.S. government recently passed will be crucial in preventing many cinema companies from defaulting on their debt, Fithian said. Much of AMC’s $4.9 billion debt load is now trading at highly distressed levels. The company’s junior bonds traded yesterday at 40 cents on the dollar, down from 80 cents at the beginning of March, according to MarketAxess. AMC has seen its stock value plummet since it closed all of its roughly 630 U.S. locations on March 16. The company had tried to operate within government guidelines restricting the number of people gathering in one place before closing the auditoriums altogether.

VIP Cinema Holdings Inc., which makes reclining seats for movie theaters, is shutting down for good after economic fallout from the coronavirus pandemic made a proposed restructuring impossible, WSJ Pro Bankruptcy reported. The St. Louis-based company told hundreds of employees it would close down, as efforts to combat the pandemic through social distancing have taken a brutal toll on the entertainment industry. The business had filed for chapter 11 in U.S. Bankruptcy Court in Wilmington, Del., in February but hoped to emerge with about $150 million less debt under a restructuring proposal backed by Oaktree Capital Management LP. What was supposed to be a speedy exit from bankruptcy began unraveling as many of VIP Cinema’s customers stopped showing movies to try to slow the spread of the pandemic. VIP Cinema’s biggest shareholder is private-equity firm H.I.G. Capital, which invested in the company in 2017 and would have retained a stake under the restructuring proposal. Backers of the prepackaged strategy had second thoughts as the Covid-19 pandemic spread.

Like hotels and airlines, cruise companies have seen their business decimated by the coronavirus pandemic and economic shutdowns, the Washington Post reported. But unlike those industries, major cruise operators don’t locate their headquarters in the U.S., so they will not have access to $500 billion in aid for large employers in the massive stimulus bill, the industry’s trade group said yesterday. Language in the 883-page bill passed by the Senate says that to be eligible for aid from the $500 billion fund, companies must be certified as “created or organized in the United States or under the laws of the United States” as well as having “significant operations in” and a majority of employees based in the U.S. Major cruise companies have located their primary headquarters overseas, which for years has allowed them to pay almost no federal taxes and avoid some U.S. regulations. To staff their ships, the companies rely heavily on foreign workers from the Philippines, Indonesia and India.

Lenders to AMC Entertainment Holdings Inc. tapped Gibson Dunn & Crutcher LLP to help advise them after the virus pandemic forced the heavily indebted chain to shutter its U.S. movie theaters, choking off revenue, Bloomberg Law reported. The term-loan lenders engaged the law firm as a pre-emptive measure for talks with AMC’s management that are ongoing. The company has more than $5 billion in debt outstanding. AMC closed all of its approximately 600 U.S. locations last week after public officials around the world placed limits on public gatherings to prevent the spread of the Covid-19 virus. AMC now has “no revenue and substantial fixed costs,” which has left it scrambling to preserve cash, the company has said. The chain also drew all remaining available amounts under its credit facilities as a precautionary measure to increase its cash position and preserve financial flexibility in light of the Covid-19 outbreak, according to a company filing.

Marriott International Inc., the world’s largest hotel company, and a growing number of hotel owners are furloughing tens of thousands of workers or slashing staff in an effort to steer their companies through the coronavirus pandemic, the Wall Street Journal reported. Hilton Worldwide Holdings Inc. and Hyatt Hotels Corp. are also furloughing many employees, the hotel companies said yesterday, as most travel plans world-wide grind to a halt. Marriott confirmed that the company is furloughing about two-thirds of its 4,000 corporate employees at the company’s Bethesda, Md., headquarters. Marriott is also furloughing about two-thirds of its corporate staff abroad, though the company couldn’t immediately provide the number of Marriott corporate overseas jobs. Those actions follow Marriott’s decision to begin furloughing what the company expects to be tens of thousands of hotel staff — from managers to housekeepers — while it ramps up hotel closings across the globe. (Subscription required.)

Marriott International Inc., the world’s largest hotel company with nearly 1.4 million rooms world-wide, said that it is starting to furlough what it expects will be tens of thousands of employees as it ramps up hotel closings across the globe, the Wall Street Journal reported. The company began shutting down some of its managed properties last week, a Marriott spokeswoman said. The employees at these properties won’t be paid while on furlough but the bulk will continue to receive health-care benefits that are ultimately paid by the hotel owner, she added, which for the vast majority of the brand’s properties isn’t Marriott. Marriott is also trimming staff through furloughs at properties that are still operating. The staff reductions include everyone from general managers to housekeepers. The Marriott spokeswoman said that there has been no layoffs or furloughs at the corporate level but those are “under discussion.” Marriott said it expected to bring back as many of the furloughed employees as possible when the novel coronavirus is contained and business returns. In the U.S., about 130,000 employees are on the Marriott payroll, the company said.

Gov. Steve Sisolak’s (D) unprecedented order on nonessential Nevada businesses will shut down 440 licensed casinos, bringing Nevada’s dominant industry to a complete halt and leaving tens of thousands of workers in differing degrees of economic uncertainty, the Las Vegas Review-Journal reported. The announcements from various gaming companies over previous days about plans to close or remain open in response to the spread of the new coronavirus became moot when Sisolak made his declaration yesterday that all casino operations cease at midnight. Bill Miller, president and CEO of the American Gaming Association, urged the federal government to provide aid after Sisolak’s announcement.

The Trump administration is asking Congress to approve a massive economic stimulus package of around $850 billion to stanch the economic free-fall caused by the coronavirus, the Washington Post reported. Treasury Secretary Steven Mnuchin will present details to Senate Republicans today. The package would be mostly devoted to flooding the economy with cash, through a payroll tax cut or other mechanism with nearly $50 billion directed specifically to helping the airline industry. The $850 billion package would come in addition to another roughly $100 billion package that aims to provide paid sick leave for impacted workers, though the details of that legislation remain very fluid as it moves through Congress. Mnuchin would like to see the package pass the Senate by the end of the week, he told senators yesterday. Read more.

In related news, U.S. airlines are seeking over $50 billion in financial assistance from the government, more than three times the size of the industry’s bailout after the Sept. 11 attacks, the Wall Street Journal reported. The exact form of the aid—and the amount—is under discussion with Trump administration officials and congressional leaders. A potential aid package could include government-backed loans, cash grants and other measures including relief from taxes and fees. Industry trade group Airlines for America, or A4A, also proposed $8 billion in grants and guarantees for cargo carriers. U.S. airports are separately seeking $10 billion in assistance to counter forecast full-year losses already approaching $9 billion. Read more. (Subscription required.) 

Carnival Corp said yesterday that it expected to swing to a net loss this fiscal year and will take a six-month loan of about $3 billion, drawing down all of an existing credit line, as the cruise industry reels from the fallout of the coronavirus pandemic, Reuters reported. The company has temporarily suspended global voyages across all its brands including Princess Cruises, whose two ocean liners became hotbeds for the outbreak. U.S. President Donald Trump said on Friday that four cruise operators, including Carnival, had agreed to suspend outbound cruises for 30 days, at his request.