AMC Says Bankruptcy ‘Off the Table’ After Raising Equity, Loans
AMC Entertainment Holdings Inc. said it was no longer at risk of a bankruptcy filing after assembling $917 million of fresh financing, continuing its fight to fend off the effects of Covid-19 on its theater business.
The world’s largest cinema chain’s shares soared as much as 50% in premarket trading and were up 36% to $4.76 at 7:39 a.m. in New York.
The Leawood, Kansas-based company has raised $506 million of equity, after securing $100 million of additional first-lien debt and converting $100 million of second-lien debt into equity, it said in astatement Monday. It also said it executed commitment letters for $411 million of new debt through mid-2023.
“Any talk of an imminent bankruptcy for AMC is completely off the table,” AMC Chief Executive Officer Adam Aron said.
The deal includes a loan of 400 million pounds ($547 million) to its U.K. subsidiaryOdeon Cinemas Group Ltd., which will refinance a 100 million-pound revolving facility and provides 300 million pounds of liquidity. The transaction is subject to the consent ofSilver Lake Management, majority holder of AMC’s convertible notes due 2026.
Theater chains have been hard hit by government-mandated shutdowns during the Covid-19 pandemic. While some locations have been able to reopen at limited capacity, many moviegoers have been reluctant to attend. The problem has been compounded by studios delaying major releases that drive ticket sales.
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