AMC Entertainment says bankruptcy is off the table after raising more than $900 million since December

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AMC Entertainment says bankruptcy is off the table after raising more than $900 million since December

 

KEY POINTS

• Since Dec. 14, AMC has raised $917 million of new equity and debt capital.
• “This means that any talk of an imminent bankruptcy for AMC is completely off the table,” said CEO Adam Aron.
• The cinema chain has secured enough financing to remain open and operational deep into 2021.

 

Noam Galai | Getty Images Entertainment | Getty Images

 

Shares of AMC skyrocketed Monday after the company disclosed that it had secured enough financing to remain open and operational deep into 2021.

“This means that any talk of an imminent bankruptcy for AMC is completely off the table,” said CEO Adam Aron.

 

Since Dec. 14, the largest movie theater chain in the world has raised $917 million of new equity and debt capital, the company revealed Monday in an SEC filing.

 

Around $500 million of this fundraising came from the issuance of new common shares and an investment deal with Mudrick Capital Management. The company has also executed commitment letters for $411 million of incremental debt capital from upsizing and refinancing its European revolving credit facility.

 

Shares of the company were up more than 20% in morning trading. The stock is down 48% over the past year, bringing its market value to $564 million as of Friday’s close.

“Looking ahead, for AMC to succeed over the medium term, we are going to need for much of the general public in the U.S. and abroad to be vaccinated,” Aron said. “We welcome the commitment by the new Biden administration and of other governments domestically and internationally to a broad-based vaccination program.”

 

Movie theaters have been hit hard by the coronavirus pandemic. First they were shuttered due to rising cases and then, when they reopened, moviegoers were hesitant to return. Cinemas are hoping that an influx of new content from Hollywood, declining Covid-19 cases and a rise in vaccinations will give consumers the confidence to come back.

 

So far, around 21 million vaccines have been administered. However, the U.S. is still recording at least 170,000 new Covid-19 cases and at least 3,080 virus-related deaths each day, based on a seven-day average calculated by CNBC using Johns Hopkins University data.

 

Last week there was a slew of movie delays. The latest James Bond flick, MGM’s “No Time to Die,” was pushed from April to October, Sony’s “Ghostbusters: Afterlife” was moved to November, and Sony’s “Morbius” and “Uncharted” exited to 2022.

 

Disney also shifted a half-dozen films, including “The King’s Man,” later into the year or removed them from the calendar entirely.

The few films that remain in February and March are tied to streaming releases. Warner Bros.′ “Tom and Jerry” heads to HBO Max and theaters on Feb. 26, Disney’s “Raya and the Last Dragon” will debut in theaters and on Disney+ for $30 on March 5, and Warner Bros.′ “Godzilla v. Kong” hits HBO Max and cinemas on March 26.

 

 

Source: AMC Entertainment says bankruptcy is off the table after raising more than $900 million since December