AMC Entertainment Holdings Inc., one of the largest cinema chains in the world, has announced a strategic move to restructure its substantial debt burden. The company plans to leverage its theater properties as part of a comprehensive deal designed to alleviate its financial pressures.
In a bold effort to address its mounting debt, AMC will utilize its real estate assets—the theater properties—to secure more favorable terms with creditors and investors. This restructuring plan aims to reduce the company’s debt load and improve its overall financial stability.
AMC Entertainment Holdings Inc. is initiating a plan to refinance up to $2.45 billion of its debt.
As part of this plan, the company will issue $1.2 billion in new secured term loans, which are due in 2029. This issuance is aimed at replacing existing senior secured term loans that are due in 2026.
AMC will also issue approximately $414 million in exchangeable notes. The funds raised from these notes will be used to repurchase an equivalent amount of second-lien notes, totaling around $414 million.
The restructuring could potentially reduce the company’s debt by $464 million through the conversion of debt into equity.
The agreement with creditors will extend the maturities of up to $2.45 billion of AMC’s debt from the year 2026 to dates extending into 2029 and beyond.
AMC’s CEO stated: “The difficulties at the box office in the first half of 2024 are behind us. We’re seeing a rebound and anticipate significant box office growth in the latter half of 2024, extending into 2025 and 2026. With this announcement, we are even more assured of our business’s future and will keep taking the right steps to ensure AMC thrives in an improving environment.”
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