AMC Entertainment has formally changed its name to “APE” in an effort to further secure its financial future since its main rival Cineworld has announced that it is considering filing for bankruptcy.
The new class of shares from the corporation, known as APE in honour of the retail investors known as “apes” who supported the stock throughout the COVID-19 pandemic, are expected to start trading on the NYSE at some point today. It will have the ticker $APE.
Each Common Share shall be exchanged for one (1) APE Unit, resulting in the formation of approximately 517,000,000 Shares of the New Stock.
Monday’s pre-market trading saw a more than 30% decline in AMC stock.
The company’s new AMC Preferred Equity (APE) shares, according to AMC Entertainment CEO Adam Aron, should satisfy concerns that the movie chain could collapse under the weight of debt accrued during the COVID-19 pandemic (see video above).
In the short term, it eliminates the danger of not surviving, according to Aron. “So if we need money, we can raise it. That benefits our stockholders.”
Aron continued, saying that this newest smart scheme—along with the gold mine AMC purchased earlier this year—will help the company acquire money to pay off debt and consider buying additional theatre chains.
On June 2, 2021, an AMC theatre may be seen in Times Square in the Manhattan neighbourhood of New York City, New York, USA. Carlo Allegri for Reuters
The ability to raise funds for expansion, M&A activity, and debt repayment is another thing it enables, according to Aron. “All of these are advantageous for AMC. These are bright times for AMC due to it, an improved box office, and a comeback from the terrible epidemic of 2020 and early 2021.”
According to what shareholders voted back in 2013, the company might theoretically list five billion APE shares, but Aron emphasised that he had no plans to do so.
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