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AMC Plans To Use ‘Unique Position’ To Snap Up Struggling Theaters


AMC plans to use its liquidity from selling millions of stock shares to buy up theaters from companies that didn’t fare as well during the pandemic.


AMC raised a lot of money in the past two calendar years, CEO Adam Aron said in a Yahoo Finance interview last week, referencing a short squeeze that sent stocks soaring in January 2021. AMC raised $2.25B by selling stock into the marketplace and had $900M in liquidity at the end of Q3, he said. 

Now it's going on a buying spree.

"I think there's going to be an opportunity for us to pick up theaters quite inexpensively and pick up really high-quality theaters and potentially quite profitable theaters," Aron told Yahoo Finance Live. "Right now, because of the unique position we’re in, that we have liquidity and a lot of our competitors do not, I think we're going to be able to actually pick up more very fine locations and do it at bargain basement prices."

AMC, the world’s largest theater chain, has seen a net loss of 57 locations since the pandemic began, closing 106 locations and opening 49 new ones, Yahoo Finance reported.

But Black Panther: Wakanda Forever’s release has renewed hope for the future after a big opening weekend at the box office, generating $180M in ticket sales in the U.S. and Canada, BNN Bloomberg reported. AMC Entertainment Holdings Inc. climbed about 16% in trading Monday, marking an increase of 61% in three days, according to the article. 

So far this year, ticket sales have totaled a historically lackluster $6.4B, according to The Numbers. The top grossing movie has been Top Gun: Maverick, pulling in $716M. 

But Top Gun: Maverick became available to purchase on streaming services 91 days after its theatrical debut, following a pandemic-inspired trend that has made it easier to watch new movies from home. Box office figures in 2020 and 2021 totaled $2B and $4.5B, respectively, according to The Numbers.

Movie releases are also down 20% to 30%, Aron told Yahoo Finance, attributing the drop to production delays one and two years ago. 

The lack of attendance and revenue has led to closures and bankruptcies. Theater chain Decurion Corp., for example, closed all its locations in 2021. Cineworld, the second-largest movie theater chain and parent company of Regal Cinemas, filed for Chapter 11 bankruptcy, Bisnow previously reported.

Most theaters from smaller chains have emerged from the pandemic, though some, including Studio Movie Grill and Alamo Drafthouse, have also filed for Chapter 11 bankruptcy. Others are being converted to other uses.

"Frequently other companies come in and refurbish and reopen closed locations," National Association of Theater Owners Chief Communications Officer Patrick Corcoran said. "That's been happening throughout the pandemic and we expect it to continue."

Decurion Corp. filed an application in Los Angeles to develop a 273K SF industrial campus at the site of one of its theaters, and earlier this year, Maple Grove, Minnesota’s city council approved a plan for Atlanta-based Floor & Decor to gut the interior of the former AMC Arbor Lakes 16 and convert it into its first store in the state, Bisnow reported.