AMC seeks $550 million as stock closes at record low

The world’s largest movie theater chain is still about $550 million shy of its fundraising goal.

On Tuesday, AMC CEO Adam Aron said the company had managed to raise just over $200 million of the $750 million it needs to fund cash requirements through then end of this year.

“We need to raise more, but we’re working hard to do that and we’ve laid out a plan and a blueprint to get there,” he said. “Whether we get there or not, only time will tell.”

Aron’s appearance on CNBC’s “Closing Bell” comes the same day that his company’s stock fell to a 52-week intraday low of $1.91 per share and closed at a record low of $1.98 per share.

AMC has been crippled by the coronavirus pandemic and its shares reflect investors’ lack of confidence in the movie theater industry’s immediate recovery. Shares of the company fell more than 70% in 2020.

Movie theaters were forced to shutter in mid-March and spent more than six months last year closed to the public. AMC is operating around 400 of its nearly 600 theaters with limited seating capacity and shorter hours. Theaters in New York City and parts of California remain closed.

The company is in the process of trying to renegotiate its rent payments with landlords and is seeking reductions, abatements and deferrals. Should the company not be able to secure additional sources of liquidity, it reiterated, it may have to enter bankruptcy proceedings.

AMC is not eligible for grants from the $15 billion Save Our Stages Act, which is part of the much larger $900 billion coronavirus relief package, because it is a publicly traded company with locations in more than 10 states.

AMC headed into the pandemic with nearly $5 billion in debt, which it had amassed by outfitting its theaters with luxury seating and from buying competitors such as Carmike and Odeon. 

The company has already renegotiated its debt to improve its balance sheet and in December received a $100 million investment from Mudrick Capital Management.

“We have our work cut out for us,” Aron said. “We do need to raise more money to get to the other side. Having said that, we’ve done that four times already, and that’s our focus.”