Shares of AMC soared on Monday after CEO Adam Aron said the company has raised $917 million in debt and equity that takes bankruptcy "completely off the table" and allows it to extend its "financial runway."
AMC said it raised $506 million of equity by issuing 164.7 million new shares. That is in addition to a previously announced $100 million of additional first-lien debt and another 22 million new common shares to convert $100 million of second-lien debt into equity.
The company also has additional commitment letters for $11 million of incremental debt capital in place through mid-2023, unless repaid before then, through the upsizing and refinancing of a European revolving credit facility. AMC may pay non-cash PIK (payment in kind) interest through the duration of the European debt.
The coronavirus pandemic and subsequent shutdowns have put movie-theater operators in a dark space financially, not only due to sudden and massive losses in revenue but also due to the runoff effect of more people streaming content directly.
However, "Based on a variety of assumptions, including future attendance levels, the company estimates that its financial runway has been extended deep into 2021," it said.