AMC Shareholders Approve Key Measures That Would Help Company Raise Fresh Cash, Convert APE Units

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AMC stockholders today overwhelmingly approved a pair of provisions that would dramatically enhance the company’s ability raise fresh cash by issuing and selling shares and boost the price of the company’s shares in a ten-for-one-reverse stock split

said at the meeting. “Your vote today sends a very strong signal that we are doing exactly as you wish.”

Some 80% of votes cast approved an amendment to the giant theater chain’s certificate of incorporation to increase the share authorization of common stock to 550 million shares. Some 87% of votes cast backed the 1-for-10 reverse stock split. That consolidates the number of existing shares of stock held by shareholders into fewer but more valuable shares. It doesn’t change the value of the company, just the stock price.

AMC base of primarily retail, or individual, stockholders in the past hasn’t wanted the company to issue new shares since that dilutes the value of their holdings. It’s the reason Aron last year created the new publicly tradedunits, which could be issued and sold without approval. The problem is that the value of the APEs, which was supposed to track AMC stock, fell sharply, making them much less useful that hoped for as a currency.

“I would like to commend our shareholders for the wisdom exhibited in your vote by approving these proposal and doing so by such wide margins,” Aron said. “The surest way to combat naysayers and prophets of doom is to keep our cash reserves robust.”

 

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