Theatres says it has raised nearly $1 billion in recent weeks — a sum that should help the struggling movie theater chain avoid filing for bankruptcy protection.
The Leawood, Kan.-chain announced Monday that it had raised $917 million in new equity and debt financing. In a news release, AMC CEO and President Adam Aron said "the sun is shining on AMC."
"This means that any talk of an imminent bankruptcy for AMC is completely off the table," his statement said.
In October, AMC warned investors it could run out of cash by the beginning of 2021. Movie theaters have been hit particularly hard by the pandemic, as both consumer demand has sunk and studios have limited the release of new films.
AMC, the world's largest movie theater chain, said its latest infusion of cash "should allow the company to make it through this dark coronavirus-impacted winter."
Still, the future remains uncertain: AMC lost money in 2017 and 2019, carried more than $4 billion in debt and had little cash on hand going into the pandemic. And it's unclear how many consumers will go back to movie theaters after the pandemic is under control, particularly as Hollywood has more quickly moved content directly to streaming services.
One expert predicts as many as a quarter of the 7,800 movie theaters in the United States could close because of the pandemic.
Liberty, Mo.-based B&B Theatres, a family owned chain, also has publicly acknowledged the possibility of a bankruptcy restructuring,
In a filing with the Securities and Exchange Commission, AMC acknowledged that its survival is still dependent on future consumer traffic.
AMC says its latest fundraising should keep the chain alive through July 2021 if theater attendance does not improve. If attendance increases and the chain can obtain more rent concessions from landlords, it could have enough cash to operate through the end of 2021, the filing 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," Aron said in Monday's news release. "To that end, we are grateful to the world's medical communities for their heroic efforts to thwart the COVID virus. Similarly, we welcome the commitment by the new Biden administration and of other governments domestically and internationally to a broad-based vaccination program."
