Traders work on the floor of the New York Stock Exchange, Aug. 22, 2022.
Brendan McDermid | Reuters
Shares of AMC Entertainment fell sharply on Wednesday after the theater chain said in a filing that it plans to sell up to 40 million new shares to raise cash.
The stock dropped 36.8%, bringing it to $8.62 per share. FactSet reports that this is AMC’s lowest closing price ever.
AMC’s stock fell sharply on Wednesday.
AMC was widely expected to sell additional shares after the successful conversion of the preferred APE shares into AMC common stock in August. The settlement followed a lawsuit that was filed against the conversion. The sales helped AMC stabilize itself after the Covid pandemic effectively halted the theatrical movie business.
However, AMC used up its allotment of stock and needed shareholder approval to issue more. The company issued preferred APE stock as part of its strategy to change the corporate voting structure, and to get shareholder approval for additional common shares. Citigroup, Barclays B. Riley Securities, and Goldman Sachs were listed in the filing as the sales agents. AMC announced to pop star Taylor Swift last week that it will be the distributor of a concert film from The Eras Tour, which is scheduled for release in October.