AMC Entertainment supply ( NYSE: AMC) is off one more 3.5% Wednesday mid-day along with information that S&P has actually reduced its lasting credit scores ranking to CC, from CCC+ – a response to the firm’s suggested debt-for-equity purchase.
Along with the credit report downgrade, S&P placed AMC on an adverse expectation moving forward.
AMC had actually revealed that a person of its noteholders accepted trade $100M well worth of the firm’s 10%/ 12% cash/pay-in-kind second-lien notes due 2026 for regarding 91M AMC Preferred Equity Devices (APE) – an action suggested to minimize AMC’s financial obligation problem by $100M and also reduced yearly passion expenses by $10M.
” We check out the revealed debt-for-equity exchange as troubled and also identical to default,” S&P claimed, due to the fact that “our team believe the second-lien noteholder will certainly get much less than initially assured given that they are subordinating safeguarded financial obligation for equity.”
” In our sight, AMC is seeking this purchase due to the fact that its funding framework is unsustainable and also has actually restricted choices to minimize its financial obligation problem and also enhance its capital,” S&P claimed.
AMC’s Preferred Equity Devices (APE) were down 24.1% Wednesday.