Antara Capital LP, AMC Entertainment’s (NYSE:AMC) largest institutional shareholder just cashed out a whopping $72.4 million in APE shares (NYSE:APE).
An SEC filing shows the company disposed more than 48 million APE shares at the price of $1.51 on Wednesday March 15, leaving the company with a total of 179.2 million shares in its armory.
Shares of the equity fell on Wednesday from its opening high of $1.65 to $1.42.
APE is currently up +18% this year-to-date, though shares have fallen more than -78% since its inception.
Soon, retail investors will no longer be able to purchase the equity as the shareholder vote to merge APE and AMC common stock has been approved.
The proposals, including AMC’s 1-for-10 reverse stock split, have been temporarily delayed until the Delaware lawsuit has been cleared, per CEO Adam Aron.
However, screenshots of a filing have surfaced on social media showing the plaintiff’s motion to intervene has been DENIED.
This means AMC’s proposals will carry out without further interference.
Shareholders await an official announcement from AMC CEO Adam Aron.
What is Happening with AMC Entertainment Today?
Today, AMC Entertainment is going through some major changes with its stock, now that proposals to merge APE with AMC and a reverse stock split have been approved.
The value of APE and AMC will merge to reflect one single share price — APE will be delisted upon the completion of this merge.
A 1-for-10 reverse stock split will multiply AMC’s share price by 10, but divide shareholders share count by 10.
Ex.) AMC’s current share price of $4.21 will go up to $42.10 in a reverse stock split.
Investors holding 10 will hold 1 share, investors holding 100 shares will then hold 10 shares, and investors holding 1,000 shares will hold 100 shares after a reverse stock split.
“Today was a huge step forward for AMC. You voted YES, YES & YES! And it was a landslide vote too — 88% yes for Proposal 1, 87% yes for Proposal 2, and 87% yes for Proposal 3. My sincerest thanks for giving AMC the tools we need to continue fighting the good fight on your behalf,” said the CEO on Twitter.
“Saving AMC is my professional mission. And remember that I own millions of AMC shares and APE units too. So, I very much want for AMC to succeed. I am absolutely and passionately convinced that what you approved today is in the best interests of AMC and of all our shareholders.”
Antara cashed a good chunk of APE shares, and AMC’s CFO Sean Goodman managed to collect $230K from selling nearly all his shares.
But it seems Adam Aron isn’t interested in selling at the moment, but rather raising cash to keep AMC Entertainment afloat.
AMC CEO Adam Aron Hints at Destroying Short Thesis
CEO Adam Aron hinted at destroying the short thesis earlier this month.
The movie theatre chain has been under attack by short sellers since before the pandemic.
However, short sellers saw an opportunity when the world’s largest movie theatre chain closed its doors in 2020 due to the pandemic lockdowns.
Adam Aron says the company went from earning millions per month to $0 overnight during the wake of the Coronavirus pandemic.
When retail investors found how high the short interest data in AMC was, they piled up to squeeze short sellers from their positions by purchasing shares of the movie theater chain en masse.
At first, investors were able to drive AMC’s stock price to $20 in January.
Then, shareholders saw AMC stock hit an all-time high of $72 per share in June.
Since then, low borrow fees have made it easier for short sellers to bring the stock back down.
But now that short borrow fees have skyrocketed, retail investors have clearer runway to squeeze short sellers again.
On Twitter, Adam Aron responded directly to a user regarding AMC’s short thesis.
The user said, “Shorts attack companies they feel they can destroy. If you become a successful company you destroy a short’s thesis hence no logical reason to continue shorting. This is @CEOAdam strategy and the only strategy that has ever worked in the history of the market! #AMC#AMCSqueeze.”
To which the CEO answered:
“Joe, you nailed it. I could not have put it better myself”.
Feel free to leave your thoughts below on what’s happening with Antara and Ape, or anything else happening with the company for that matter.
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