AMC Entertainment shares tumbled roughly 25% on June 23 after the company set terms for a $200 million stock offering, its second major capital raise in less than two weeks. The company agreed to sell 95.25 million new shares to institutional investors at $2.10 each, a 24% discount to the prior close, sparking fears of shareholder dilution. AMC plans to use most of the proceeds to redeem all $125.5 million of its 6.125% senior subordinated notes due 2027, which would lower interest costs and clear a near-term repayment deadline. The offering closed on June 25 with net proceeds of about $189 million after fees, and it followed a $150 million at-the-market offering completed on June 11 that sold roughly 105.3 million shares. Despite improving box office attendance and first-quarter revenue climbing to $1.05 billion, the rapid pace of equity issuance has weighed heavily on the stock, which now trades near the low end of its 52-week range.
AMC Entertainment Holdings IncAMC announced a $200 million stock offering at a 24% discount, causing dilution fears and a 25% stock drop.