What happened
Actions of AMC Entertainment (NYSE: AMC) skyrocketed on Monday after the country’s largest film company said it raised $ 917 million in shares and debt capital. As of 2:45 pm EST, AMC’s share price rose 30%.
And
AMC’s newly discovered cash includes $ 506 million in stock sales and $ 411 million in new debt. Management believes these moves will allow AMC to “survive this winter affected by the dark coronavirus”. “Today, the sun is shining on AMC,” said AMC CEO Adam Aron in a press release.
AMC Entertainment’s shares soared after shareholders received some hopeful news on Monday. Image source: Getty Images.
Aron went on to say that investors no longer need to worry about AMC’s failure in the short term. “This means that any talk of an impending bankruptcy for AMC is completely out of the question,” said Aron.
What now
With its strengthened balance sheet, AMC believes it has the cash it needs to finance its operations until “early 2021”. The company warns, however, that its future cash needs are difficult to predict due in part to the uncertainty related to the increase in coronavirus infections and the results yet to be determined from the COVID-19 vaccination programs.
“Looking ahead, for AMC to succeed in the medium term, we will need a large portion of the general public in the United States and abroad to be vaccinated,” said Aron.