Cineworld chief executive Mooky Greidinger and his management team have bagged a combined payout approaching $35mn from the struggling cinema operator’s lenders to sweeten their departure from the company after it emerges from Chapter 11 proceedings next month.

The group’s creditors are set to take control of the company when the almost year-long bankruptcy process wraps up in July and are planning to install a fresh management team to oversee a turnround as it struggles with a slow recovery from the coronavirus pandemic and a customer exodus to streaming platforms.

To make the bankruptcy agreement more palatable, the lenders committed to pay Greidinger, his brother and deputy chief executive Israel Greidinger, finance head Nisan Cohen and chief commercial officer Renana Teperberg between $30mn and $35mn in cash in the year following their exit, according to people familiar with the matter.

Through a series of debt-fuelled acquisitions, first of UK-based Cineworld in 2014 and then of US-based Regal Cinemas in 2018, the Greidingers transformed their family-owned Israeli cinema group into a global giant. But when the pandemic struck, shuttering the industry and leading to Cineworld abandoning a $2.1bn takeover of Canadian rival Cineplex, the cinema chain’s $8.8bn in debt and lease liability quickly became its undoing.

The Greidinger brothers, whose family trust owned about a fifth of Cineworld, stand to receive the vast majority of the cash, the people said. Some of the money will be paid immediately after the emergence from Chapter 11 proceedings, with the rest paid a year later subject to their abiding by a non-compete agreement and fulfilling advisory roles for any new management team.

During bankruptcy negotiations the Greidingers pushed to be granted a shareholding in the newly formed entity under management incentive plans through which the new board can be granted equity-based awards. However, the lenders, which include US asset managers such as Invesco and Eaton Vance, refused.

Despite the large payout, one of the claimants in the bankruptcy process said the Greidingers “being shown the door” was some form of “comeuppance”. The cinema chain’s weak trading in the early months of the bankruptcy process meant the secured lenders quickly “soured” on the brothers, who did not impress them in meetings, the claimant added.

The Greidingers have lost hundreds of millions of dollars because of Cineworld folding, according to people close to the company, who said the lenders were compensating them so they could tap their expertise and business relationships during the transition to a new management team.

The Financial Times reported in March that the lenders were planning to oust the current management team and that former Regal finance chief David Ownby, who is advising some of the secured lenders, was among those being considered for the role. Headhunter Korn Ferry is now nearing completion of its search for Cineworld’s next boss, according to people familiar with the matter.

In the first half of 2021, when many of Cineworld’s staff were being paid through state-funded furlough schemes, the Greidinger brothers were hit by two shareholder rebellions over a £65mn bonus scheme that granted them stock-based awards of up 1.25 per cent of shares, based solely on share price targets.

As part of the bankruptcy agreement, the lenders will reduce Cineworld’s debt pile by $4.5bn, provide new debt of $1.5bn and backstop an $800mn equity rights issue. Cineworld shares are expected to be delisted from the London stock exchange and the remaining shareholders will be wiped out.

While Cineworld’s loans are still trading at deep discounts to face value their prices have improved in recent weeks on the back of an improving outlook for the cinema industry, with the price of a $2.6bn loan doubling from 16 cents to 32 cents on the dollar.

Cineworld owns 751 cinemas across 10 different countries. A representative for both Cineworld and the Greidingers declined to comment.