AMC secures $950 million bond deal in bid to pay down debt

An AMC theatre is pictured in Times Sq. in the Manhattan borough of New York Town, New York, June 2, 2021.

Carlo Allegri | Reuters

AMC Entertainment struck a offer to refinance its credit card debt, nearly doubling the dimension of the bond presenting it made early Wednesday.

AMC been given investor commitments for a new $950 million bond deal that it will use to fork out down maturing debt and similar service fees. The business had in the beginning focused a deal measurement of $500 million with an interest level of 10.5{f8f9f7e6fa72495c30ab254213729fbbad6cff923a9c63d260c5c902274d4d9d}.

The new bond will have an desire rate of about 7.5{f8f9f7e6fa72495c30ab254213729fbbad6cff923a9c63d260c5c902274d4d9d} and extends the maturity by 4 many years to 2029.

Issuing these senior secured notes is the subsequent step in CEO Adam Aron’s bid to enhance AMC’s economical place.

Although the domestic box business has started to recuperate, ticket product sales remain muted in comparison to prepandemic degrees. Refinancing to drive credit card debt maturities out can aid AMC help you save income and shell out down desire on other notes that are owing sooner.

This suits the narrative that Aron has been communicating to investors in 2022. At the commencing of the 12 months he stated his goal was to “refinance some of our personal debt to lessen our curiosity cost, force out some financial debt maturities by several a long time and loosen covenants.”

Right after narrowly keeping away from personal bankruptcy very last calendar year, AMC rode the meme inventory wave and revitalized its business enterprise. Now it will have to offer with a lot more than $5 billion in debt that it amassed prior to the pandemic by way of theater updates and acquisitions.

Shares of the corporation slipped much more than 8{f8f9f7e6fa72495c30ab254213729fbbad6cff923a9c63d260c5c902274d4d9d} on Wednesday, final investing about $15. AMC’s stock is down extra than 40{f8f9f7e6fa72495c30ab254213729fbbad6cff923a9c63d260c5c902274d4d9d} so considerably in 2022.