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AMC Entertainment Holdings said Thursday it would raise $110 million in new equity capital through the sale of its preferred stock and proposed a reverse stock split, sending the cinema chain’s shares down 11%.
Antara Capital, a current AMC debt holder, will buy APE, the preferred stock, at an average price of 66 cents per share.
Antara will also exchange $100 million in debt for about 91 million APE units, which would reduce AMC’s annual interest expense by about $10 million.
The company said it is also looking to hold a meeting for APE and AMC shareholders to vote on converting APE units into AMC shares and proposed a reverse-split of AMC shares at a 1:10 ratio.
