Law360 is providing free access to its coronavirus coverage to make sure all members of the legal community have accurate information in this time of uncertainty and change. Use the form below to sign up for any of our weekly newsletters. Signing up for any of our section newsletters will opt you in to the weekly Coronavirus briefing.
Sign up for our Securities newsletter
You must correct or enter the following before you can sign up:
Thank You!
Law360 (December 4, 2020, 4:34 PM EST) -- Theater giant AMC Entertainment Holdings Inc. has announced plans to put 200 million shares of stock on the market with a warning that it could face bankruptcy if it's unable to raise the cash to keep its COVID-19-hobbled business afloat.
AMC's Thursday Securities and Exchange Commission filing on the offering — the company's third and largest this year, worth about $726 million at the price the company's stock was trading at close on Thursday — came with a warning that if the theater chain can't raise enough liquidity it "likely would result with us seeking an in-court or out-of-court restructuring of our liabilities."
The century-old Leawood, Kansas-headquartered theater company, which had proclaimed itself the largest movie exhibition company in the world, ran about 1,000 theaters worldwide and employed about 39,000 full- and part-time workers before the pandemic.
The pandemic devastated AMC's finances as it was forced to shutter theater doors, although its third quarter financial report, released Wednesday, said about 900 of its theaters had reopened at reduced seating capacity.
That same report, though, showed theater attendance was down 92% and revenues were down nearly 91% from the third quarter of 2019, resulting in a nearly $906 million net loss for the quarter and a more than $3.6 billion net loss for 2020 so far.
The report said the company had $417.9 million in cash as of the end of September — down from $498 million at the end of June — and that its priority was "liquidity management," which it said has included securing $1 billion in concessions from landlords and other creditors, drawing down on $375 million in revolving credit and the sale of its nine theaters in Latvia, Lithuania and Estonia for $77 million.
In April, AMC floated a $500 million debt offering after it was sued for $7.5 million in unpaid rent it owed in Florida and it announced plans to sell 15 million shares of stock in September.
According to the third quarter report, this offering and a second 15 million share offering in October raised nearly $98 million.
Weil Gotshal & Manges LLP is serving as counsel for AMC on the offering.
Representatives for AMC did not immediately respond to requests for comment Friday.
--Additional reporting by Sierra Jackson. Editing by Alyssa Miller.
For a reprint of this article, please contact reprints@law360.com.
