AMC Theatres Secures Refinancing Deal to Push Debt Maturities to 2029

AMC Entertainment Holdings has reached a debt refinancing deal that will push up to $2.45 billion of debt maturities from 2026 to 2029 and beyond.

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The restructuring deal, unveiled on Monday, aims to give the movie theater chain breathing room on its balance sheet to pay down an estimated $4.5 billion in long-term borrowings. “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 Theatres CEO Adam Aron said in a statement.

The debt refinancing plan calls for around $1.2 billion in near-term loans due 2026 to be swapped for new secured term loans due 2029, with an additional $800 million of 2026 maturities potentially to be pushed out to 2029.

To exchange new debt for existing borrowings, AMC in a July 22 SEC filing indicated it had put up as collateral around 175 theaters and certain intellectual property, including the AMC brand name. A licensing agreement will allow AMC to continue using the shifted assets and IP.

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In early 2021, AMC became a popular stock among “meme” traders after the company appeared close to bankruptcy amid the pandemic fallout at movie theater chains. At the time, the stock surge helped the exhibition giant strengthen its financial position and diversify its revenue streams.

But the latest debt restructuring deal comes as AMC grapples with a heavy debt burden and CEO Adam Aron Aron continues to reduce borrowings and strengthen the company’s balance sheet, where possible, to run the business. That has involved past capital raises to offset the company’s high debt load and its ability to ride out the pandemic and the impact of the disruption in its Hollywood movie calendar due to the dual actors and writers strikes.

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