AMC should be basking in the blockbuster opening weekend for “Barbie” and “Oppenheimer,” but it has been handed a headache by a Delaware court instead.
AMC Entertainment Holdings Inc.’s plan to convert its AMC Preferred Equity units to common stock was blocked Friday when a judge rejected a settlement that would have allowed the deal to proceed.
The stock-conversion plan was part of the movie-theater chain and meme-stock darling’s ongoing battle to eliminate debt. In response to the court ruling, AMC AMC CEO Adam Aron said Sunday that the company had submitted a revised proposal for the APE-conversion plan. Specific details of that revised proposal have not yet been revealed.
So now AMC, rather than basking in the glow of a blockbuster opening weekend for “Barbie” and “Oppenheimer,” now finds itself focused on a fresh set of challenges. “AMC is instead concerned with its cash requirements, APE APE shares falling, and the writers’ and actors’ strikes persisting,” Reese wrote.
“If that occurs, AMC’s 518 million shares outstanding would reverse-split to 52 million AMC common shares outstanding,” Reese added. “Of AMC’s 930 million APE shares outstanding, 93 million would convert to AMC common shares, resulting in 145 million total shares outstanding as of the effective date of conversion, when APE shares would no longer trade.”
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