In order to help the struggling movie theater chain to avoid filing for bankruptcy protection AMC theater said that it has raised nearly $1 billion in the recent weeks. In the new equity and debt financing, it was announced by the Leawood, Kansas-chain that it has raised an amount of $917 million. Adam Aron who is AMC’s theater CEO and President said that the sun was shining on AMC, according to a news release.
His statement said that it will be pretty dumb of someone to talk about AMC’s bankruptcy. It was warned by AMC to its investors in October that they might run out of cash at the end of 2021. The movie theaters have been hit vigorously due to this pandemic as the studios have limited the release of the new movies and the consumer has sunken as well.
Why AMC Theater raises $1 Billion.?
The latest infusion of cash should allow the company to make it through the dark coronavirus winter, this is said by the largest movie theater chain, AMC. AMC lost a lot of money in 2017 and 2019 carrying more than $4 billion in debt and before going into the pandemic they had a little amount of cash due to which its future remains uncertain. After Hollywood moved its contents directly to streaming services so quickly its pretty unclear about how many people would go back to the movie theaters after the pandemic gets under control.
As per the reports from the experts due to this pandemic almost a quarter of 7800 movie theaters in the US is going to get closed. AMC has acknowledged in a filing with the securities and exchange commission that its survival completely depends upon the future consumer traffic.
AMC said that if the theatre attendance doesn’t improve then its latest fundraiser would keep the chain alive through July 2021. The filing said that if the attendance increases and the chain could obtain more rent concessions from landlords then it would have that much cash which would operate through the end of 2021
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