AMC Entertainment (AMC) announced it secured nearly $1 billion in new financing, sending its stock soaring in premarket trading Monday.
The theater chain operator was tiptoeing around bankruptcy after the COVID-19 pandemic forced cinemas to close, Hollywood to shut down, and premieres of movies already made to be postponed until later in 2021.
Image source: Getty Images.
While AMC recently raised about $200 million of the $750 million it said it needed to survive through the rest of this year, a number of its lenders were pushing for it to declare bankruptcy.
After its financing deal announcement, though, AMC CEO and president Adam Aron said "Any talk of an imminent bankruptcy for AMC is completely off the table."
Happy days are here again
The movie theater operator said it raised $917 million through a combination of equity and debt. On the equity side, AMC secured $506 million by issuing 164.7 million new shares along with the previously announced $100 million of additional first-lien debt and converting $100 million of second-lien debt into equity.
It raised an additional $411 million by executing commitment letters of new debt through the middle of 2023 by upsizing and refinancing its European revolving credit facility.
"Today, the sun is shining on AMC," Aron said. The theater chain said the push to vaccinate the general public makes an increase in theater attendance likely.
