AMC Theatres Raises $230 Million for Acquisitions, Targets Many ArcLight Venues

Funding comes from a stock sale to Mudrick Capital announced Tuesday

Thom Geier

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AMC Theatres owner AMC Entertainment announced Tuesday that it plans to raise $230.5 million for key acquisitions in the movie theater sector — and confirmed talks to acquire venues operated by the now-shuttered ArcLight Cinemas and Pacific Theatres.

The funding comes from the sale 8.5 million shares to Mudrick Capital Management at $27.12 per share, according to documents filed with the Securities and Exchange Commission.

“Given our scale, experience and commitment to innovation and excellence, AMC is being presented with highly attractive theatre acquisition opportunities,” AMC Entertainment CEO Adam Aron said in a statement. “We are in discussions, for example, with multiple landlords of superb theatres formerly operated by ArcLight Cinemas and Pacific Theatres.”

Last December, AMC Theatres raised $100 million from Mudrick in a debt offering for needed capital while most of its theaters remained shuttered due to the pandemic. AMC’s stock price has surged in recent months, though, fueled by Reddit-fueled investors who have pushed the share price from just over $2 at the end of 2020 to nearly $34 last week.

Since the California-based indie chain ArcLight announced in April that it would close permanently, there has been much speculation about the future of its 300 screens in California and a handful of other states — particularly the historic Cinerama Dome on Sunset Boulevard.

Aron noted how the recent market surge had enabled the new deal since the 8.5 million shares represent a small portion of the current trading volume. “This transaction underscores the real value of having some authorized share capital available for us to opportunistically capitalize on shareholder value creation possibilities as and when they arise,” he said.“With our increased liquidity, an increasingly vaccinated population and the imminent release of blockbuster new movie titles, it is time for AMC to go on the offense again.”

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