AMC Entertainment Seeks Debt Relief In Distressed Bond Swap
- Firm under strain as theaters stay closed during pandemic
- Subordinated bondholders asked to accept haircut of about 50%
The lobby is seen at the temporarily closed AMC movie theater in Cartersville, Georgia, U.S., on April 22.
Photographer: Dustin Chambers/BloombergTheater chain AMC Entertainment Holdings Inc. is seeking to tame its debt load by asking subordinated bondholders to accept a steep haircut on existing debt as it casts doubt on its ability to repay future borrowings.
The company, hit hard by the coronavirus pandemic that has shuttered theaters across the country, is offering a swap that would require investors to take cuts of about 50% from full face value on existing debt, according to a regulatory filing Wednesday. The swap targets four subordinated notes, which sit below all other debt in line for repayment. The three dollar-denominated bonds are trading at deeply distressed levels in the range of 26 to 27 cents on the dollar, according to Trace data.