AMC Entertainment Holdings (AMC) disclosed late Monday that it had reached a settlement that will let it go ahead with plans to convert is AMC Entertainment Preferred (APE) shares into common stock. The news sent AMC stock plunging and APE stock soaring after hours.
XAMC Entertainment, in its SEC filing, disclosed a binding settlement with plaintiffs in the shareholder lawsuit regarding the movie theater chain's stock conversion plan. Plaintiffs will get common shares. In return, AMC and the plaintiffs will request that a "status quo order" be lifted, allowing for the conversion of APE stock into AMC stock.
AMC also will be allowed to carry out a 1-to-10 reverse stock split and have the right to sell more shares.
Lifting the status quo order still needs court approval.
AMC Entertainment issued AMC Preferred as a way to raise more capital without directly issues more AMC common shares.
AMC stock dived 22% to 3.98, near January's two-year lows. APE stock popped 22% to 1.81.
In theory, APE stock should be worth the same as AMC stock.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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April 04, 2023 at 05:08AM
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AMC Stock Dives, APE Preferred Shares Soar On Stock Conversion Settlement | Investor's Business Daily - Investor's Business Daily
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