AMC Theatres to Get New Debt Deal That Will Provide a Lifeline Into 2021
AMC Theatres is set to get a new debt deal that will extend them a lifeline into 2021. This agreement with debt holders would cut their current debt by up to $600 million. As an added bonus for the theater chain, there would be $200 million available to help get them over the finish line. AMC sold $500 million in bonds earlier this year as coronavirus ravaged the economy. Adam Aron, AMC CEO, is still planning to open theaters on July 30th as COVID-19 cases continue to spike across the United States. All that activity on the virus front has led a lot of spectators to believe that reopening could get pushed back even later in the year, resulting in another round of release date delays.
In summary, the company is trying to get bondholders to agree to a debt swap that would afford them a discount according to Deadline. June came and went with only a small number of these entities taking them up on their offer, but today's news casts a life raft for the struggling theater industry. It's been four months since the vast majority of locations have been able to sell so much as a ticket. Executives and economic experts were rightfully concerned that this could be a devastating blow to the theater industry. But, this current deal will secure that $200 million senior loan and keep AMC Theatres rolling onward into the uncertainty of 2021.
"As we plan our reopening, the health and safety of our guests and associates is our absolute highest priority," AMC said in a previous statement. "To be able to open, we also need a line of sight into a regular schedule of new theatrical blockbusters that get people truly excited about returning to their favorite movie theatres. Those blockbusters are scheduled to return this summer, beginning with Warner Brothers' Tenet and Disney's Mulan, with many more major titles scheduled immediately thereafter."
"While we expect to open our theaters in the weeks ahead of these new blockbusters, utilizing creative programming of immensely popular previously released films, we would be wise to do so only directly in advance of the release of major new movie titles. AMC is currently working through every detail required to successfully showcase these exciting new releases in an environment that's safe and welcoming for moviegoers, and we will share those details as we get closer to the dates when our theaters will reopen."
Will you be seeing Tenet in theaters? Let us know down in the comments!