SHARES in Cineworld - which has two cinemas in Newport, one of which has been closed for more than two years - have tumbled further after it denied being in talks with Odeon owner AMC Entertainment over a potential buyout.

The denial came despite AMC saying it backed out of negotiations with the troubled cinema rival last month.

Cineworld would not comment on who AMC claims to have spoken to over a possible sale of its cinemas, but said there have been no discussions with officials within the business, its advisers or lenders.

Cineworld runs a cinema in Newport's Spytty Park. Although it has a second site in Friars Walk, this did not re-open after the Covid-19 pandemic. Last year Friars Walk said the cinema chain is still leasing the premises, but announcements regarding whether or not it will re-open have not been forthcoming.

A spokesman from the cinema chain said: “In light of recent media reports, Cineworld would like to clarify that neither it nor its advisers have participated in discussions with AMC Entertainment regarding the sale of any of its cinema assets.

“Cineworld also understands that neither the ad hoc group of lenders under the group’s 2018 credit facility nor its advisers were party to discussions with AMC.”

It contradicts a statement from AMC in December, which said it had been in discussions with the lenders of Cineworld over plans to acquire “certain strategic theatre assets” of the chain in the US and Europe – with negotiations since abandoned.

Cineworld, which runs the second-largest chain of cinemas in the world, filed for bankruptcy protection in the US in September after taking a big hit from weaker-than-expected audience numbers over the summer.

The group said it is going ahead with a marketing process in efforts to sell its assets for a good value and expects to begin contacting potential buyers this month.

It forms part of its plans to restructure the group and emerge from bankruptcy in the first three months of this year, which will maximise value for “moviegoers and all other stakeholders”.

The group said there is “no guarantee of any recovery” for shareholders in Cineworld if it does agree to a transaction.

“As previously announced, it is expected that any restructuring or sale transaction agreed with stakeholders will result in a very significant dilution of existing equity interests in Cineworld”, it said in a statement.

Shares in Cineworld dropped by about 15 per cent on Tuesday morning after the announcement.

Its share price has plummeted by over 80 per cent over the past six months.