AMC — which owns the theater chain that was all but shuttered for most of 2020 and still faces an uncertain 2021 — announced today that it's secured nearly $1 billion in investment capital that "should allow the company to make it through this dark coronavirus-impacted winter."
Some $506 million of the new money comes from equity. The other $411 million is from incremental debt capital that's put in place through mid-2023, unless it's paid off sooner. In other words, AMC is putting a $506 million bet on its business returning by then.
Despite new strains of the COVID-19 making headlines and some countries and states in locking things back down, and upwards of 4,000 people dying daily in the United States, AMC is looking forward.
"Today, the sun is shining on AMC," CEO and president Adam Aron said in a press release. "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."
From a company standpoint, that's a good thing. But it doesn't change the fact that the theater business is in no way certain in 2021. Warner Bros. movies already will see simultaneous releases in theaters and on the HBO Max streaming service, meaning more people will be watching from home than in theater seats. And other tentpoles like the newest James Bond flick No Time Time Die are seeing new delays — this time to the fall.
It'll be interesting to see what other tricks AMC might have up its sleeve. Personal theater rentals undoubtedly have staunched the bleeding a tad. But the company isn't anywhere close to business as usual, and it's looking for the COVID-19 vaccines to change that.
“Looking ahead," Aron said, "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. 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.”
