AMC Entertainment has filed to sell 15 million shares of common stock to raise fresh cash, the second exhibition distress call today after Regal parent Cineworld of the U.K. posted a brutal results for first six months of the year.
Regal is the largest circuit in the U.S., AMC the second. Exhibitors shut down in March and have opened slowly across many states but are still dark in key markets New York and Los Angeles and lack high-profile product to lure audiences used to sheltering in place.
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AMC announced a large and complex debt restructuring over the summer that raised cash from note sales, cut interest expenses and pushed out maturities. Today it filed with the Securities and Exchange Commission to sell up to 15 million Class A common shares through Citigroup and Goldman Sachs. The last reported price before the filing was $4.78, AMC said. On midday Thursday, ACM stock was down 2.6% at $4.66.
Among other exhibition shares, Cinemark was off 4.4% and National CineMedia down 2.2%.
Being COVID times, the boilerplate list of risk factors that’s included in any offering to sell stock was particularly long in AMC’s filing, at 30 items leading with the impact of the virus on its business.
Theater owners have been stuck in a chicken-and-egg situation.
Warner Bros. Tenet released in the U.S. September 3 was meant to jumpstart the revival of the theatrical business. But that was in part dependent on other big films following. With audiences slow to return and major market still shut, studios have continued to delay releases.
The industry had really been banking on Wonder Woman 1984 in early October but that was moved to year end.
Earlier this week, Disney shifted Black Widow from November to May of 2021. Kenneth Branagh’s starry ensemble Death on the Nile was moved from October 23 to December 18. Steven Spielberg-directed West Side Story moved up a year to December of 2021. Patricia Highsmith’s Deep Water moved from November to August of next year.