Cineworld, the second-largest theater chain in the world, is set to declare for bankruptcy after failing to observe a swift enough rebound in movie attendance following the end of the COVID-19 pandemic.

According to the Wall Street Journal, the company, which runs 751 facilities in 10 countries, including the Cineworld and Picturehouse chains in the United Kingdom, is anticipated to file a chapter 11 petition in the United States and is considering insolvency procedures in the United Kingdom.

The already depressed share price of Cineworld fell from 20 percent to 2 percent as a result of the report. Prior to the pandemic, the price was £1.97.

Cineworld's market value dropped by more than 50 percent on Wednesday after the firm announced it has begun discussions with stakeholders about a financial rescue plan, blaming a lack of blockbuster films for lower-than-anticipated admissions.

Investors' reactions to the news caused the company's market value to plummet to less than £50 million on Friday, from a high of £4.4 billion before the pandemic nearly decimated the film industry.

The firm stated that it was engaged in "active negotiations with various stakeholders" and considering strategic options to obtain more financing and possibly restructure its balance sheet to decrease debt.

The company stated on Wednesday that its business operations will not be harmed by its decision to seek financial stability and that it "expects to continue meeting its continuing business counterparty commitments."

Labor groups representing Cineworld's 45,000 global employees, including over 5,000 in the United Kingdom, have expressed fear for their future.

"This is really concerning news, especially for Cineworld and Picturehouse employees in the United Kingdom, who have already endured a difficult period during the pandemic," said Philippa Childs, the head of the UK union Bectu.

At the end of 2021, Cineworld reported a $493 million year-over-year increase in net debt, bringing the total to $4.8 billion. The company faces a nearly $1 billion settlement for withdrawing from an agreement to acquire its Canadian rival Cineplex.

The company lost $708 million last year. However, revenues increased from $852 million to $1.8 billion as a result of the recent James Bond and Spider-Man films. The firm posted a record $3 billion loss in 2020.

In 2021, the business welcomed around 95 million moviegoers, a 75% increase from the 54 million in 2020 but a far cry from the 275 million who attended before the pandemic.