(Reuters) – AMC Entertainment Holdings Inc, the world’s largest movie theater operator, said on Friday it has enough cash to withstand a global suspension of operations until a possible partial reopening of its locations in July.
FILE PHOTO: Deckchairs sit stacked outside a closed movie theater during the global outbreak of coronavirus (COVID-19) in Santa Monica, California, U.S., March 16, 2020. REUTERS/Lucy Nicholson/File Photo
The company said it was seeking to raise $500 million in a new debt offering that would provide enough liquidity to withstand coronavirus-related closures until the U.S. Thanksgiving holiday, on Nov. 26, if necessary.
Movie theaters worldwide have been shuttered since mid-March to help prevent further spread of the novel coronavirus. In the United States, the individual states are now considering when to allow businesses to reopen.
Shares of AMC surged on Friday, closing up 31% at $3.20 on the New York Stock Exchange. Shares of rival Imax Corp and Cinemark Holdings Inc rose 9% and 16%, respectively.
Even after Friday’s surge, AMC’s stock remained down roughly 60% from late February, just before fears of the coronavirus sent Wall Street tumbling.
U.S. theater operators are aiming to reopen some locations as early as late June and nationwide by late July, but all plans are tentative
On Thursday, President Donald Trump released guidelines that call for reopening of businesses in three stages. Movie theaters were listed among large venues that could open their doors in the first phase with “strict physical distancing protocols”.
States may use the guidelines to decide when to begin easing their restrictions on business operations.
AMC said its theaters would remain closed through June, and that timeline could be extended.
The company, which has put many employees on furlough, said it had a cash balance of $299.8 million as of March 31.
Rival Cinemark also is working to raise $250 million through a debt sale.
Reporting by Supantha Mukherjee in Bengaluru and Lisa Richwine in Los Angeles; Editing by Leslie Adler