AMC Entertainment Holdings Inc. stated that it is launching a new effort to sell up to 43 million shares of stock, as the movie-theater chain continues efforts to strengthen its cash position while grappling to recover from the pandemic.
The company on Tuesday also stated that it is temporarily canceling its campaign to increase by 500 million the amount of shares it would be able to sell, which would almost double its total share count. The matter was settled to be voted on by shareholders at a May 4 investors meeting.
Chief Executive Adam Aron stated that the company believes shareholders will benefit from toughening up AMC’s cash reserves through the sale of the 43 million shares it currently has available to sell.
AMC’s stock traded at $11.25 Tuesday after hours, down roughly 2% on the news.
However, “as to the request for 500 million to be authorized, many of the stockholders are telling us to wait,” he stated. Some researchers had expressed concern regarding their shares being diluted if too many new shares were issued, according to analysts who track the company. Mr. Aron stated that AMC will likely revisit the proposal at some point in the future.