Proactive Investors - AMC Entertainment Holdings (NYSE:AMC) shares added more than 5% on Monday afternoon after the video game retailer announced a new debt deal with creditors.
The company said the refinancing transactions extend $1.6 billion in debt due in 2026 to 2029 and 2030.
It has also arranged for the potential repurchase of up to $800 million of existing loans due in 2026 to be exchanged for new term loans due to 2029.
Further, the company issued $414 million of exchange notes due in 2030 and said it will potentially issue up to an additional $50 million in exchangeable notes to repurchase outstanding debt due in 2025, 2026 and 2027.
“This agreement represents an undeniably strong vote of confidence by our lenders in AMC’s future and provides AMC with the necessary financial flexibility to capitalize on an expected strong industry recovery trajectory,” AMC CEO Adam Aron said in a statement.
“Not only have our lenders agreed to extend our debt maturities but we have also created the potential for significant debt reduction as the industry recovers.”
Aron added that the box office challenges of the first half of 2024 are now “in the rear-view mirror.”
“We expect strong year-over-year box office growth in the back half of 2024, continuing into 2025 and 2026,” he said.
“With today’s announcement, we are ever more confident in the future of our business as we will continue to take the necessary actions to best position AMC to thrive in a more favorable environment.”
AMC shares closed up 5.4% on Monday and added another 0.8% afterhours at $5.32.