AMC Begins Plan to Stay Out of Bankruptcy and Sees Stock Increase After US Reopening Plan

Due to the current coronavirus pandemic, "non-essential" businesses have shut down in order to keep people at home. With only a few exceptions, movie theaters across the country have closed down. The future of some big theatre chains has been in question lately, and it was reported last week that AMC Theatres were in talks to hire bankruptcy lawyers. Now, it's being reported that the White House has laid out a plan to begin reopening the country's economy over the next couple of months. The new guidelines for starting businesses up again after this period of self-isolation specifically mentions movie theaters. As for AMC, things are looking up for the chain this week as shares saw an increase on Thursday.

According to Deadline, "AMC Entertainment shares roared to life in after-hours trading, rising as much as 37% after the company announced a $500 million debt sale and the White House announced sweeping measures to reopen U.S. businesses." They added, "Beaten-down shares in AMC, which closed the regular trading day at $2.44, shot up to $3.35 after hours." Apparently, CEO Adam Aron has "expressed hope" that theaters might reopen in the United States by the end of June, "salvaging some of the all-important summer blockbuster season and setting up a packed second half of the year."

"Exactly what the theatrical landscape looks like as the U.S. emerges from virus lockdown is anyone's guess," Deadline explained. "Trump didn't offer many specifics about social distancing protocols." They added, "AMC's debt offer consists of first-lien notes due in 2025. The company said it plans to use the proceeds 'for general corporate purposes, including further increasing AMC's liquidity.'"

Under the Phase Two guidelines set up by the White House, large venues such as movie theaters, sports arenas, sit-down restaurants, and places of worship, and schools should be allowed to open up with "moderate physical distancing protocols." For theaters, this will likely look like the protocols that were enforced before things started closing down, where seats within the theaters are made unavailable when purchasing tickets, keeping the crowds smaller and people farther apart.

The first major movie release on the schedule at this time remains Christopher Nolan's Tenet, which is set to hit theaters on July 17th. Just one week later, on July 24th, Disney plans to release the live-action Mulan.