(Reuters) – The buyout firm Silver Lake on Friday announced that it had sold its stake in AMC Entertainment Holdings for $ 713 million this week, with a tenfold increase in the share price while traders organized on social media such as Reddit. They op.
The deal puts Silver Lake and its co-investors in the black as a result of a $ 600 million convertible investment the private equity firm made in 2018 at AMC. It seems unlikely that AMC, the world’s largest film chain, has struggled to reverse last bank’s bankruptcy, a move it avoided thanks to a deal with Silver Lake and its creditors.
Silver Lake was able to convert the bonds into shares thanks to the rise that pushed AMC’s share this week above the conversion price of the bonds.
AMC shares fell 70% in 2020 to close the year at $ 2.12, as many of the company’s movie theaters closed or operated with reduced capacity during the COVID-19 pandemic.
But the stock traded at $ 19.90 on Wednesday as traders traded strong stocks like AMC and GameStop Corp. Silver Lake sold its stake in several open market transactions on the same day.
The sale makes Silver Lake the latest investment venture to earn this week’s unprecedented shortfall in shares. The government’s Ontario Retirement Plan this week sold $ 497.4 million worth of stock it owned in U.S. mall owner Macerich Co.
AMC itself also benefited from the rally. It raised $ 304.8 million by selling shares this week. It is considering new moves to raise capital through share sales, sources told Reuters on Thursday.
Reporting by Joshua Franklin in Miami; Edited by Leslie Adler