AMC Entertainment said it was in talks with lenders to potentially acquire cinemas from the portfolio of bankrupt rival Cineworld, which owns Regal Cinemas.
In an SEC filing, the issuer said the negotiations were related to Chapter 11 bankruptcy proceedings with Cineworld in the UK. An unspecified number of theaters in the U.S. and Europe have been booked, though negotiations are currently “at a standstill,” the filing said.
The acquisition would have been partly financed by AMC issuing new “APE” shares (the recently introduced preferred class) along with debt financing from Cineworld backers.
“During the discussions, the company did not provide any confidential or non-public information, analysis, compilation, forecast, study or other document to the borrowers,” AMC said in the filing. “A final agreement has not been reached with the lenders on the terms of an offer to be made to the debtors at the Cineworld store.
While AMC plans to continue with “value-added” mergers and acquisitions, it said that “no guarantee can be given” that it will resume talks with Cineworld backers.
Covid paralyzed many exhibitors and forced many to close their doors for months. As the reality of the new film market set in with fewer releases and dramatically shorter theatrical windows, several circuits closed or shut down for good.
Investors seemed excited by the news of the Cineworld talks, as AMC shares rose 5% in early trading. They recently tumbled to earth after a meme-fueled whirlwind since 2020, a time when the stock approached $60 despite considerable uncertainty about the prospects for a box office visit.
Cineworld shares fell almost 5% on the London Stock Exchange.
Writer: father Hayes
Source: Deadline
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