AMC Entertainment Holdings
stock was surging in after-hours trading on Friday—and it has nothing to do with Barbie, Oppenheimer, or any other movie being released this weekend.
In something of a shocker, a judge blocked AMC (ticker: AMC) from converting its so-called
APE
(APE) shares into common stock. That will prevent an agreement that AMC had with shareholders that would have allowed the conversion to take place, with additional stock going to shareholders to make up for the dilution.
The judge didn’t provide much of a reason, other than to say that “the settlement cannot be approved as submitted,” according to Bloomberg.
AMC stock had surged 71% to $7.52 at 5:27 p.m., while APEs—short for AMC Preferred Equity—dropped 17% to $1.50. This isn’t the first time, though, that a judge has denied requests from AMC.
Now, it’s back to the drawing board.
AMC has fallen far since its days as a meme-stock darling, with its shares down more than 80% since peaking in 2021. Strangely, the stock even started to trade based on something that resembled fundamentals, such as when it rose in May after reporting solid earnings. The apparent success of ‘Barbenheimer,’ as the double feature of Barbie and Oppenheimer is known, might have been another reason to be optimistic about the business. Instead, it’s back to meme-stock city.
Let the fun begin.
Write to Ben Levisohn at [email protected]
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