AMC Entertainment is back in the headlines today December 22nd and for good reason. CEO Adam Aron tweeted out a press release saying: “AMC Entertainment Holdings, Inc. Announces $110 Million Equity Capital Raise, a $100 Million Debt for Equity Exchange, and a Proposed Vote to Convert AMC Preferred Equity (“APE”) Units Into AMC Common Shares and Implement a Reverse Stock Split”
The press release also said:
- “Raises $110 million of new equity capital through the sale of APE units to Antara Capital, LP (“Antara”) at a weighted average price of $0.660 per share. The APE closing price on the NYSE on December 21, 2022 was $0.685.
- Reduces debt by $100 million principal amount of 2nd Lien Notes due 2026 currently held by Antara in exchange for approximately 91.0 million APE units. This $100 million principal debt reduction reduces annual interest expense by approximately $10 million.
- Seeks a special shareholder meeting to vote on the following AMC Board of Directors proposals:
- To convert APE units into AMC common shares.
- To reverse-split the number of AMC common shares at a 1:10 ratio“
CEO Adam Aron took to twitter with the following tweet:
Adam Aron worded the tweet and the announcement in sort of a positive way with encouraging wording like: “AMC in a much stronger cash position! #ChokeOnThat” But the bigger question is… What do the AMC investors known as the apes think about this? Is this going to be the straw that breaks the camel’s back, or could this be a positive catalyst for AMC to finally start inching back to all-time highs?