AMC Theatres has successfully raised $917 million in new equity and debt capital. The much needed cash should keep the company afloat throughout most of 2021. In addition, Adam Aron, AMC CEO and president, says that "imminent" bankruptcy is "completely off the table." While many were looking at 2021 to be the year that got moviegoing audiences back into theaters, it has not started off that way. Analysts are now predicting that movie theaters may be able to open later this summer, or possibly in the fall.
In a statement, AMC Theatres said, "This increased liquidity should allow the company to make it through this dark coronavirus-impacted winter." They went on to add that, "financial runway has been extended deep into 2021." Over 60% of movie theaters in North America are closed, and many of them have been shut down since March 2020. AMC also says that they have been having positive dialogue with their landlords, which should make reopening much easier.
The $917 million that AMC Theatres was able to raise is made up of "$506 million of equity," which comes from the "issuance of 164.7 million new common shares, along with the previously announced securing of $100 million of additional first-lien debt and the concurrent issuance of 22 million new common shares to convert $100 million of second-lien debt into equity." For now, Adam Aron is confident about the future of the moviegoing experience. He had this to say.
"Today, the sun is shining on AMC. After securing more than $1 billion of cash between April and November of 2020, through equity and debt raises along with a modest amount of asset sales, we are proud to announce today that over the past six weeks AMC has raised an additional $917 million capital infusion to bolster and solidify our liquidity and financial position. This means that any talk of an imminent bankruptcy for AMC is completely off the table."
Adam Aron and the rest of AMC Theatres are banking on the vaccine being widely available in the coming months. "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. President Joe Biden has issued a plan to have 100 million people vaccinated in 100 days, which is a good start, but still leaves a lot more work to be done. Aron continues, "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."
For now, it looks like AMC Theatres, who spent nearly all of 2020 looking at imminent bankruptcy, will be just fine in 2021. However, it will be up to studios to decide if their movies will open in theaters this year or not. Warner Bros. has already committed to their streaming hybrid, which will have movies opening in theaters and on HBO Max on the same day, which will likely find people watching new movies from the comfort of their own homes. Variety was the first to report on AMC Theatres raising enough money to last through 2021.