On Tuesday, AMC Theatres' owner announced the company's plan to raise $230.5 million for major acquisitions in the movie theater sector, specifically setting its eyes on the recently-shuttered ArcLight Cinemas and Pacific Theatres. The news comes after much speculation about the future of cinemas across California after indie chain ArcLight permanently closed operations in April.
While the movie theater sector continues to slowly recover from pandemic-related closures, AMC has bounced back thanks to Reddit investors and now plan to acquire ArcLight theaters, according to The Wrap. AMC's stock price surged in recent months after investors pushed the share price from $2 at the end of 2020 to roughly $34 last week. AMC Entertainment's funding for the acquisitions comes from the sale of 8.5 million shares to Mudrick Capital Management at $27.12 per share following their market recovery. CEO Adam Aron's statement can be read below:
“Given our scale, experience and commitment to innovation and excellence, AMC is being presented with highly attractive theatre acquisition opportunities, we are in discussions, for example, with multiple landlords of superb theatres formerly operated by ArcLight Cinemas and Pacific Theatres.”
Acquiring the former ArcLight Cinemas and Pacific Theatres would be a monumental move for AMC, as the permanent closure of the theaters was devastating to moviegoers in the state of California. ArcLight Theatres' iconic Cinerama Done, located off Sunset Blvd. in Hollywood, was a favorite spot for filmmakers. It was notably featured in Quentin Tarantino's Once Upon A Time In Hollywood. However, the locations were unable to survive after theaters in Los Angeles were shut down for over a year due to the COVID-19 pandemic, leaving fans of the theatres to hope that someone would buy the shuttered venues.
Aron claimed that the company felt "opportunistic" about AMC's ability to capitalize on shareholder value creation possibilities and that an increasingly vaccinated population, in addition to the release of several blockbuster movies, meant theaters are on the upside. Whether this means the company is able to revive Hollywood's beloved Cinerama Dome is still uncertain, but AMC's ambitious expansion shows a promising return to the big screen for venues across the country.
Source: The Wrap
