Will the Credits Roll for AMC After This Reopening Delay?
The reopening of the U.S. economy has been a relatively slow process, and summer blockbusters may have to wait a little longer to hit theaters after this update from AMC Entertainment Holdings Inc. (NYSE: AMC). The world’s largest movie-theater chain announced that it would further delay its reopening.
Late Thursday, the company said that it now plans to open its U.S. theaters in “mid-to-late August.” AMC was shooting to open on July 30, which also was a delay from its original plan of opening on July 15.
Although the government lockdowns were not entirely successful and were ultimately lifted, AMC is taking the safe route of keeping its theaters closed for longer to help stop the spread of COVID-19. The theater chain initially shuttered its doors in March.
This also comes in reaction to a few major global (anticipated) blockbusters postponing their release dates. “Tenet” from Warner Bros. and Disney’s “Mulan” are two of the main names on this list.
This past week, AMC announced a debt restructuring plan. It is looking to “restructure a substantial majority” of $2.3 billion of its senior subordinated notes.
Under this plan, the face amount of AMC’s total debt would be reduced by $460 million to $630 million, depending on how many lenders sign on to the agreement. However, there is a plot twist. Bloomberg reported that a group of lenders who are opposed to the debt restructuring are claiming that AMC violated its credit agreement by not providing enough information about this move.
AMC Entertainment stock traded up about 1% at $4.11, in a 52-week range of $1.95 to $12.49. The consensus price target is $3.94.