In early January, AMC Entertainment CEO Adam Aron announced a New Year’s Resolution to refinance high interest debt the chain took on to survive the pandemic.
Today, the WSJ reports he’s “in advanced talks with multiple parties” to do just that but a dip in the company’s stock (and its bonds) hasn’t helped.“The precipitous share price decline puts them in a more precarious position to refinance high interest debt and extend maturity — a worse position than they were a month or two ago,” said Alicia Reese of Wedbush Securities.
Bur she noted that AMC had, earlier, been “really successful refinancing before the retail investors came in.”If it can’t refinance or there’s a snag, it means the company would have to shell out cash, or more of it and sooner than it would like, to pay down interest due.AMC reps weren’t immediately available to comment.MY NEW YEAR’S RESOLUTION FOR AMC.
In 2020 and early 2021, AMC took on debt at high interest rates to survive. If we can, in 2022 I’d like to refinance some of our debt to reduce our interest expense, push out some debt maturities by several years and loosen covenants.
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