AMC Entertainment (NYSE:AMC) just raised $325 million in brand new equity according to the company’s latest report.
The company announced late Wednesday that it has completed its previously disclosed at-the-market (“ATM”) equity offering launched on September 6, 2023. AMC raised approximately $325.5 million of new equity capital through the sale of 40 million shares, before commissions and fees, at an average price of approximately $8.14 per share.
“The Company intends to use the net proceeds, if any, from the sale of the Common Stock pursuant to the Equity Distribution Agreement to bolster liquidity, to repay, refinance, redeem or repurchase its existing indebtedness (including expenses, accrued interest and premium, if any) and for general corporate purposes.”
Hedge fund CEO Bruce Richards said his team anticipated AMC Entertainment to raise as much as $8 billion with $1 billion being more probable, though it was far from it.
The company stock is up more than +3% on Thursday and nearly +7% in the past five trading days.
“The completion of this ATM equity offering significantly boosts AMC’s cash reserves, addresses current liquidity concerns, and fortifies the balance sheet.
When coupled with the third quarter to-date 39% surge in industry box office compared to the same period last year and the record-breaking success of the highly anticipated TAYLOR SWIFT THE ERAS TOUR concert film, the proceeds from the ATM equity offering allow AMC to continue along its successful recovery glidepath through changing market dynamics, including the ongoing strikes by writers and actors, and capitalize on opportunities to further strengthen its balance sheet,” said the company.
Commenting on the capital raise, AMC President and CEO Adam Aron said, “The successful completion of this equity offering marks another significant milestone for AMC.
Raising more than $325 million in gross proceeds has bolstered our ability to survive and then thrive.
As we navigate the recovery phase of our industry, this infusion of capital provides us with flexibility to assist us in navigating the waters ahead and continue delivering the magic of movies to our guests.”
Other Comments From CEO Adam Aron
“I am delighted to share this extremely important news with all of you.
AMC has successfully raised $325 million of new equity capital through the issuance of 40 million shares via our at-the-market equity raise, which started September 6 and which now has been completed.
This material increase to our cash position means that any talk of immediate and imminent financial collapse right now by AMC is moot.
We still have many challenges, including Hollywood must resolve the current actors and writers strikes.
But regardless, AMC is now a much stronger company given our increased level of cash.
Like you, the coming together of AMC common and preferred stock along with the reverse stock split in August decreased both my number of owned and granted-but-unvested AMC shares/units.
So, I currently have an economic interest in more than 800,000 AMC shares now, rather than the more than 8 million AMC shares and APE units previously.
In turn, that means I personally experienced the great pain felt by all AMC shareholders at the recent decline in our stock price.
Looking though to our clearly having extended AMC’s viability, it is comforting to know that AMC has strengthened our company by so significantly increasing our cash on hand,” Adam Aron said on Twitter.
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