Raine WarrenShares of AMC Entertainment have taken a hit following the company's announcement of an agreement to sell up to 40 million shares of class A common stock. This offering will be conducted through an "at-the-market" program, with Citigroup Global Markets, Barclays Capital, B. Riley Securities, and Goldman Sachs acting as sales agents.
Utilizing Proceeds for Enhanced Liquidity
In a recent securities filing, AMC stated that it plans to utilize the net proceeds from this stock sale to bolster its liquidity. Additionally, the funds will be allocated towards repaying, refinancing, redeeming, or repurchasing its existing indebtedness, including expenses, accrued interest, and potential premiums. The remaining balance will be allocated for general corporate purposes.
However, investors have not responded positively to this news, causing the stock price to plummet by 18% to $11.18 during early Wednesday trading.
Recent Reverse Stock Split
It is worth noting that AMC Entertainment recently concluded a reverse stock split process. This initiative involved consolidating ten shares into one, making it a notable development within the entertainment company.
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