SAN DIEGO & LEAWOOD, Kan.--(BUSINESS WIRE)--Shareholder rights law firm Robbins Arroyo LLP announces that AMC Entertainment Holdings, Inc. (NYSE: AMC) may face damages caused by a pending securities lawsuit. AMC is principally involved in the theatrical business and owns, operates, or has interests in theaters located in the United States and Europe.
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Shareholder Class Action Alleging AMC Entertainment Holdings, Inc. (AMC) Made Materially False and Misleading Statements Survives Motion to Dismiss
Investors filed a class action complaint against AMC for alleged violations of the Securities Exchange Act of 1933 and the Securities Exchange Act of 1934. According to the complaint, during the fourth quarter of 2016, AMC completed its acquisition of Carmike Cinemas, Inc. for $858.2 million and acquired Odeon and UCI Cinemas Holdings Limited for $637 million. To finance its acquisitions, AMC incurred total debt amounting to $6.6 billion by the end of fiscal year 2016. Then, in January 2017, AMC announced that it had agreed to acquire Stockholm-based Nordic Cinema Group Holding AB for $929 million. To help in repaying its debt, on February 9, 2017, AMC held its Second Public Offering ("SPO") of 21,904,761 common shares at $31.50 per share, receiving net proceeds of $618 million. However, in its Registration Statement, AMC failed to identify and disclose known trends, events, demands, commitments, and uncertainties associated with AMC's Carmike and international operations that were having and were likely to continue to have material adverse effects on AMC's operating performance. As a result, AMC's stocks were sold in its SPO and throughout the relevant period at an artificially inflated price. The Company's stock currently trades at around $11, a 65% decline from its SPO price. On September 23, 2019, U.S. District Court Judge Alison J. Nathan denied in part AMC's motion to dismiss plaintiff's complaint, paving the way for litigation to proceed.
AMC Entertainment Holdings, Inc. (AMC) Shareholders Have Legal Options
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