Street performers in Minnie Mouse costumes walk past an AMC movie theater in New York’s Times Square at night on October 15, 2020.
Amir Hamja | Bloomberg | Getty Images
The world’s largest theater chain just got a $ 100 million shot in the arm.
On Friday, AMC announced that Mudrick Capital Management had agreed to invest the amount to help the financially troubled cinema chain survive the ongoing coronavirus pandemic.
The cinema chain will need at least $ 750 million in additional cash to fund its cash needs through 2021.
“Given the uncertainty surrounding our ability to raise significant amounts of additional liquidity, and the
Uncertainty about when visitor numbers might normalize, there are significant doubts about the company’s ability to continue as a business for a reasonable period of time, “AMC said in a filing for approval.
The company’s shares fell 1% on the Friday before trading.
The company estimated its cash and cash equivalents as of November 30th at approximately $ 320 million. Without additional liquidity, the available means of payment will be used up in January next year.
“A significant increase in coronavirus cases, as well as delays in major movie releases or the direct or simultaneous release of movie titles in the home video or streaming markets in lieu of theatrical shows have resulted in theater closings and preventing cinemas from opening in large numbers.” Markets and markets have had a significant negative impact on theater attendance and our business in the future, “said AMC.
The cinema chain directly cited Warner Bros.’s recent decision to release its entire 17 films on its streaming service HBO Max and in theaters at the same time as a major concern. It was also feared that other studios would follow suit.
AMC currently operates around 400 of its almost 600 theater locations with limited seating capacity and limited opening hours. Theaters in New York City and parts of California will remain closed.
The company reported that from October 1 to November 30, attendance at US theaters decreased 92% year over year.
AMC is in the process of renegotiating its rental payments with landlords and is seeking cuts, cuts and deferrals.
Should the company be unable to secure additional sources of liquidity, it reiterated that it may have to go into bankruptcy.