AMC Entertainment $AMC ( ▼ 0.8% ) got a boost after reports that the company is working to refinance roughly $2.5 billion of its heavy debt burden. The theater operator is reportedly marketing a $750 million term loan while also seeking about $1.73 billion in secured financing to restructure existing obligations.
Investors welcomed the move, as lowering interest costs and extending maturities could significantly improve the company’s financial stability.
Expensive debt comes due
The refinancing targets include a $2 billion term loan due in 2029 that carries a steep interest rate tied to SOFR plus 700 basis points, along with $400 million in senior notes maturing next year with a hefty 12.75% coupon. Those high borrowing costs have weighed on AMC’s balance sheet for years.
If successful, the new financing could reduce interest expenses and ease near-term repayment pressure, two critical factors for a company still recovering from pandemic-era disruptions.
Survival over growth
AMC’s strategy remains focused on stabilizing its finances rather than expanding aggressively. While box office trends have improved, the company continues to carry one of the heaviest debt loads in the entertainment industry.
For shareholders, progress on refinancing is less about immediate upside and more about reducing the risk of financial distress. In AMC’s case, staying afloat is still the primary victory.