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Shares of luxury theater chain iPic Entertainment dropped 18 percent on their first day of trading, hinting at Wall Street’s current lack of appetite for movie exhibition stocks.
The company’s initial public offering was for 818,429 shares at $18.50 apiece for gross proceeds of $15.1 million. The stock began trading Thursday morning on the Nasdaq Global Market, under the symbol IPIC, and closed down $3.36 to $15.14.
Separately, Regal Cinemas closed a private placement of $2.5 million in iPic after having invested $12 million in the company a year ago at $18.13 per share. India’s giant PVR Cinemas invested $4 million in iPic two months ago, also at $18.13 per share.
IPic was established eight years ago in Florida and runs premium movie theaters, which are always combined with high-end bars and restaurants, in 16 locations in nine states, though the company seeks to expand with some of the money raised in Thursday’s IPO.
IPic initially filed to offer up to 2.2 million shares, but sold less than half that number. At the IPO price, its market cap was $216 million.
Theater stocks haven’t been doing too well lately. In 2017, for example, shares of Imax fell 26 percent, AMC Entertainment’s were off 53 percent and Cinemark Holdings’ shed 6 percent.
Regal Entertainment managed to buck the trend, rising 17 percent last year, though its gains were fueled by speculation the company was a takeover target and, indeed, Cineworld agreed in December to purchase Regal for $3.6 billion.
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