AMC Announces Debt Deal to Keep Theater Chain Afloat

  • Variety
AMC Announces Debt Deal to Keep Theater Chain Afloat
AMC Theatres reached a debt agreement on Friday that could help the heavily leveraged exhibition chain avoid or at least forestall a liquidity crisis.

Under the deal, Silver Lake Group will purchase $100 million in first lien notes, adding to the $600 million in convertible bonds that it already holds in AMC. The company, which is the world’s largest theater chain, said in public filings that it will raise $200 million in cash by allowing debt-holders to swap their securities at a discount. As part of the deal, the interest they receive would be either 10% in cash or 12% in additional notes that would be due in 2026.

AMC said renegotiating its debt will help it manage to stay solvent through 2021. The company has been hit hard by coronavirus, which has forced it to shutter its chains, depriving it of income. Even before the pandemic, AMC had amassed a great deal of debt to
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