AMC surges after WSJ report that it’s working to avoid bankruptcy

A medical worker wearing a mask walks near the AMC movie theater in Times Square amid the coronavirus pandemic on May 7, 2020 in New York City.

Alexi Rosenfeld | Getty Images

AMC Entertainment shares jumped as much as 21% after the close of regular trading on Tuesday following a story in the Wall Street Journal that the movie theater company is nearing a deal to avoid near-term bankruptcy.

The Journal, citing people familiar with the matter, said AMC is working on a restructuring deal, led by Silver Lake, that would have bondholders provide a $200 million loan, swapping out “their unsecured claims at a discount.” AMC would take that route over a financing offer from Apollo Global and other lenders, the Journal reported.

As of Tuesday’s close, AMC had lost 40% of its value this year. The company has been battered by the coronavirus, which has forced movie theaters across the country to close in March. AMC says it will begin reopening theaters in waves on July 30, about two weeks later than it previously expected. Even with theaters opening up for the first time in months, there’s no guarantee that consumers will rush to be indoors surrounded by others.

AMC shares rose as high as $4.99 in extended trading after closing at $4.13. The company’s market cap is below $500 million.

WATCH: AMC delays opening of 450 U.S. theaters until July 30

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