Ximena Carreño – Cinemex
When the COVID-19 pandemic forced businesses to temporarily close, many were able to pivot.
For example, restaurants turned to curbside pickup and doctor’s offices began relying on telehealth. But for companies that provide in person experiences—like movie theaters—all they could do was wait. Such was the case for Cinemex.
“The theater world had already been decreasing with more people using Netflix and other streaming apps and we survived that, so we knew we could survive the pandemic,” says Ximena Carreño, the company’s chief legal officer. “We were able to stay together and become a stronger team through this.”
Cinemex is a movie theater chain with over 330 locations in Mexico. It also operates bowling alleys, sports bars and e-gaming centers and is starting to operate restaurants. While the company has been growing organically, much of its growth has come from acquiring other theater chains. Prior to the pandemic, Carreño was leading an average of two acquisitions per year.
That growth halted in 2020 as the company brought in no revenue. The company’s U.S. subsidiary, CMX, filed for Chapter 11 bankruptcy, leading Cinemex to restructure.
Reorganizing to regrow
Filing for Chapter 11 bankruptcy for CMX, which allows businesses to reorganize, was a “very intense process” that took about 18 months, Carreño says. She and her team had to renegotiate contracts, prepare court filings and restructure $200 million worth of syndicated credit debt with banks.
“We worked up to 20 hours a day and there wasn’t a day the team didn’t respond,” Carreño says. “Despite the storm, none of the team got off the boat. We all saw this through to the end.”
In renegotiating contracts to get better terms and conditions, the team spoke with every landlord and developer Cinemex works with. While the vendors were also experiencing struggles from the pandemic, Carreño says her team was able to strike balances that allowed them and Cinemex to continue working together.
“It was tough on both sides, but it allowed us to develop stronger relationships with landlords and vendors,” she says.
With the restructuring completed and Cinemex theaters reopened, the company is focused on growth again. In 2022, it opened four new theaters in Mexico with plans to open 10 in 2023. It’s also working to open a theater in Virginia, but Carreño says growth in the U.S. has been slowed by the bankruptcy filing and lower theater attendance.
She and her team negotiate with developers and landlords for each new location. While some locations are negotiated individually, others are done as part of larger mergers and acquisitions.
“One-by-one growth will take forever, so we want to acquire more companies,” Carreño says.
For this process, she’s the main contact with investment bankers, works closely with the financial team and oversees due diligence. She says due diligence has changed since the pandemic—more attention is given to identifying potential risk.
“We seek to educate all the areas in the company about the new risks, especially as we continue to grow,” Carreño says. “We’re very excited about the opportunities that will come to be in the next few months.”
The business of law
Carreño has enjoyed helping develop growth strategies and says she appreciates that Cinemex seeks her input.
“I deeply understand how the company operates,” she says. “I think having gone to law school and combining that with a financial understanding, you get a great business leader.”
She’s hoping to further herself as a business leader by going back to school for her MBA. She also wants to eventually take over Cinemex’s other administrative duties.
As a child, going to the movie theater was a treat for Carreño. She’s continued to love movies throughout her life, with her favorite being the 1997 film The Devil’s Advocate. While she couldn’t have imagined one day working for a movie theater company, it’s no surprise she became a lawyer.
She was interested in the subject from a young age—some of the first books she read as a child were about lawyers. Her father, who was the legal director of the Volkswagen group in Mexico, has been her biggest influence.
“He’s always been my best friend and the fact that we’re in the same industry has only made us closer,” she says.
After earning her law degree from Universidad Iberoamericana in 2009, Carreño spent a few years working at firms in Mexico City. She worked first in tax and corporate law before becoming a criminal legal affairs manager. In that role, she worked with a federal government agency on the dissolution and wind up of a national power supply entity.
In late 2010, Carreño left her home country for a job at Herzfeld & Rubin in New York City. In her six years with the firm, she specialized in commercial and trade law regarding mergers and acquisitions, corporate restructurings, joint ventures, buy-outs and corporate finance. Gaining this expertise was key in landing her role at Cinemex in 2017, she says. She also has a Master of Laws degree in international business and trade law, which she earned from Fordham University in 2013.
When interviewing at Cinemex, Carreño was also up for a job with a higher salary at an insurance company. Conflicted, she turned to her husband, who owns his own business and with whom she has three children.
“He asked which job I’d enjoy more, and I knew I’d be miserable in insurance,” Carreño says. “I chose Cinemex and I’m happy with that decision every day.”
View this feature in the Vanguard Spring I 2023 Edition here.
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