Will AMC Theatres File for Bankruptcy During Coronavirus?
AMC Theatres looks to be on the brink of filing for bankruptcy, a grim but impending reality that was only exacerbated by the coronavirus pandemic causing the entire movie business to shut down.
The likelihood of a bankruptcy reorganization doesn’t mean that AMC’s 634 locations in the U.S. and Canada — and more than 1,000 venues worldwide — will be closing their doors for good. In fact, there are real questions about whether or not AMC can, in effect, afford to go bankrupt in this climate.
Wall Street analysts last week downgraded the company’s stock from “neutral” to “sell,” signaling that the value of the nation’s largest theater chain is expected to diminish in coming months as there’s no clear path forward for multiplexes desperate to reopen. However, AMC’s cash reserves were dwindling even before the outbreak of the virus started to threaten daily life. The company was weighed down by $4.9 billion debt, other people’s money that it used to refurbish existing locations and buy competitors, such as Carmike and Odeon Cinemas.