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Cinema giant AMC Theatres is looking to raise more fresh cash, in part for debt refinancings and repayments, as it continues to look to fend off the impact of the coronavirus pandemic.
The move comes as the exhibition giant looks to continue reopening its U.S. theater circuit and survive the pandemic after a debt restructuring. On Monday, AMC unveiled in a regulatory filing that it wants to sell up to 20 million more class A shares.
The cash raise comes ahead of AMC unveiling its third-quarter earnings later on Monday after the close of financial markets. The regulatory filing calculated that the 20 million shares, priced at a maximum offering price of $2.39 each, would raise $47.7 million.
AMC’s stock was down 16 cents, or 6 percent, to $2.36 in pre-market trading on Monday. The latest capital raise will see the proceeds used “general corporate purposes, which may include the repayment, refinancing, redemption or repurchase of existing indebtedness or capital stock, working capital, capital expenditures, and other investments,” cash-strapped AMC said.
The mega-exhibitor said it will national and over-the-counter markets to sell the latest batch of class A shares in the company. AMC in July and October unveiled equity distribution agreements with Wall Street banks to place each time up to 15 million class A shares into the market.
The cinema chain at the time warned cash raises into 2021 may be needed as the continued delay of major movie releases into 2021 or seeing them diverted to streaming platforms has drained cash on its balance sheet.
Also in July, AMC completed a debt restructuring agreement with its bondholders that included $200 million in fresh cash and the Silver Lake Group purchasing $100 million in new senior notes. AMC also raised $77 million by selling nine theaters in Europe’s Baltic region.
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