AMC Entertainment recently raised around $250 million in new equity capital through a successful sale of 72.5 million shares. This at-the-market equity offering, launched on March 28, saw AMC selling shares at an average price of $3.45 per share. The timing of this sale coincided with a resurgence in the meme stock craze, fueled by the return of “Roaring Kitty.”
Following the news of the equity sale, AMC shares surged by an impressive 94% the next day. The stock’s volatility led to trading being paused at one point, indicating the heightened interest and activity surrounding AMC’s equity offering. With the stock opening at $3.52 on Monday, up 21% from the previous Friday, AMC capitalized on the elevated prices to successfully complete the sale. By the end of the trading session on Monday, AMC’s stock price had shot up by over 78% to reach $5.19.
The resurgence of “Roaring Kitty,” the figure who played a pivotal role in the meme stock mania of 2021, further fueled the buying frenzy among amateur traders. A cryptic image posted online by Roaring Kitty, depicting a man in a chair leaning forward, was enough to trigger a surge in trading activities. This resurgence in interest was not limited to AMC’s stock, as GameStop also experienced a significant surge of 74% on Monday, with trading halts occurring due to volatility. GameStop’s stock price continued to climb, exceeding 100% early during Tuesday’s trading session.
The success of AMC’s equity offering was made possible with the support of sales agents such as Citigroup, Barclays, B. Riley Securities, and Goldman Sachs. These firms played a crucial role in facilitating the sale of AMC’s shares to raise the desired capital. The strategic decision to leverage the meme stock craze and the renewed interest in AMC’s stock, coupled with the expertise of these sales agents, enabled AMC to secure the necessary funds to support its operations and growth initiatives.
AMC Entertainment’s strategic move to raise new equity capital amidst the resurgence of meme stock craze, fueled by the return of “Roaring Kitty,” has proven to be a successful one. The overwhelming market response to the equity offering, coupled with the collaboration of key players in the financial industry, has positioned AMC for continued growth and success in the evolving landscape of stock trading.
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