LOS ANGELES (CBSLA) – The nation’s biggest cinema chain is likely headed for bankruptcy as the coronavirus shutdown continues to bring the economy to a halt.
AMC Theatres, with its cash reserves quickly dwindling as movie theaters remained closed indefinitely due to COVID-19, is “increasingly likely” to file bankruptcy in the coming weeks, according to Variety.
Since the pandemic began, AMC furloughed more than 600 corporate workers and CEO Adam Aron. The Leawood, Kansas-based company also notified landlords it would not be paying rent in April due to the closures.
A report Thursday from MKM Partners analyst Eric Handler stated AMC “lacks the liquidity to stay afloat” until at least August, which is how long the firm believes theaters will be closed.
Other analysts say eliminating or deferring rent payments – a prospect facing businesses both big and small across the U.S. – could “double the number of months that AMC could survive without any revenue”.
The Dalian Wanda Group – a Chinese conglomerate — acquired AMC Theatres in May 2012 for $2.6 billion in a move that made Wanda the world’s largest cinema chain.