The stocks of AMC added to their gains from the previous week after announcing their plans to sell quite a few stocks to Mudrick Capital. The movie theater which operates from Leawood, Kansas has agreed to sell its shares worth $8.5 million of common stock Class A to Mudrick for a whopping $230.5 million. This has been calculated as a 3.8% premium over the closing price of Friday. The shares of the company increased by 116% the previous week, and it has gained close to 1,132% the current year.
AMC Will Sell Its Shares For Quite A Bit Of Profit
AMC plans to use all the proceeds from this sale to acquire even more theater leases along with making a couple of enhancements in their preexisting locations. According to Adam Aron, the CEO, the company is currently debating the pros and cons with movie theater landlords which were previously operated under the Arclight Cinemas and Pacific Theaters.
The CEO further stated that with the help of this additional liquidity, and an increasingly vaccinated population, the movie theater franchise is going to move for the offensive. A couple of blockbuster movies are around the corner, and this movie theater will go all out for them. The news of the movie theater company selling its shares was pretty well received by most of the retail investors that have supported the stocks amidst increasing attacks by multiple short sellers.
AMC stated that almost 3.2 million individuals have a stake in the shares of the company, where they hold close to 80% of the 450 million outstanding shares available. As far as news goes, this is going to be the second share sale for this company in a month. On the 14th of May, the company managed to sell around 43 million shares which they could by using the cash kept for general corporate purposes. Originally, the company had planned for a sale of 500 million shares, but the idea received widespread backlash and outrage.
With most theaters having to close down due to the pandemic, AMC reported a revenue drop of 84% the previous year.