AMC Theatres Reduces Debt Load by $553 Million

With $2.6 billion in long-term debt and enduring a shuttered business during the coronavirus pandemic, AMC Theatres has been a sitting duck in bankruptcy crosshairs.

The nation’s largest exhibitor Aug. 3 announced it has successfully restructured its debt load with 87% of its senior subordinated note holders — in a deal that gives the exhibitor upwards of $415 million in cash and “liquidity improvements” in the next 18 months.

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“Now we can focus solely on the all-important task of opening our theaters in the U.S., Europe and Middle East safely and responsibly,” CEO Adam Aron said in a statement.

AMC repeatedly delayed re-opening screens in the U.S. due to spikes in COVID-19 infections. The latest restart is slated for sometime this month.

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AMC Theatres Delays Re-Opening to July 30

AMC Theatres has pushed back re-opening 450 theaters in the United States from July 15 to July 30. The nation’s largest exhibitor had planned to jumpstart operations in about two weeks following a government-mandated shutdown in March due to the coronavirus pandemic.

But with Disney and Warner Bros. pushing back releases Mulan and Tenet, respectively, due to upticks in COVID-19 infections in California, Florida, Texas and Arizona, AMC decided to hold off.

CEO Adam Aron says the chain has invested tens of millions of dollars in sanitization protocols, including acquiring high-tech air purification systems for theaters.

“We continue to devote extraordinary resources into our plan to operate our theatres with a hyper commitment to the safety and health of our guests and associates,” Aron said in a previous statement.

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Wedbush Securities media analyst Michael Pachter doubts moviegoers are in a rush to go the cineplex without a vaccine.

“As we face a potential spike in cases nationwide after some seemingly premature re-opening schedules in addition to nationwide protests, we are less sanguine … that enough of the population will risk their health to support the current release slate schedule starting in July,” Pachter wrote.