Movie theater giant AMC has announced that it has been able to raise more than $900 million allowing it to ward off bankruptcy for most of 2021. About $500 million was raised by issuing new common shares along with Mudrick Capital Management making an investment deal and another $411 million in incremental debt capital by retooling its European revolving credit facility. News sent shares of AMC up 35%, however the stock is down 48% over the past year and now has a market cap of $564 million.
As the pandemic started and lockdowns were mandated, AMC was forced to close all of its theaters, effectively cutting off all income, and when they were allowed to reopen, the public has largely avoided move theaters, leaving the chain unable to break even month to month. Adding to AMC’s problems, an increasing number of movies either had their theatrical releases, where they get exclusive time in the theaters, reduced or some when directly to streaming via a host of providers such as HBO Max, Apple TV, and more, leaving the movie theaters with no in-demand movies to show.
AMC CEO Adam Aron said “looking ahead, for AMC to succeed over the medium term, we are going to need for much of the general public in the U.S. and abroad to be vaccinated”, indicating he does not believe people will feel safe going to movie theaters again until Covid has been eliminated or been reduced to the common annual flu level, an endemic.
So far, the U.S. still has 170,000 new Covid-19 cases a day and 3,080 Covid deaths per day according to Johns Hopkins University. Those figures are a rolling 7-day average.
Upcoming movies and movies to either be delayed or to be released both in theaters and on streaming platforms at the same time include James Bond’s “No Time To Die”, “Ghostbusters: Afterlife”, Disney’s “The King’s Man”, “Tom & Jerry” and “Godzilla v. Kong”. The last one, Godzilla v. Kong is being released in theaters and HBO Max on March 26.