AMC Entertainment recently completed an at-the-market equity offering, raising approximately $250 million in new equity capital. The company sold 72.5 million shares at an average price of $3.45 per share before commissions and fees. This move was made during a resurgence of the meme stock craze, which was reignited by the return of “Roaring Kitty.” The timing of the sale coincided with AMC’s stock price seeing a significant increase, opening at $3.52 on Monday, up 21% from the previous day. As a result, AMC was able to take advantage of these elevated prices to complete its equity offering.
“Roaring Kitty,” the individual credited with inspiring the meme stock mania of 2021, made a comeback online with a cryptic image. This image depicted a man in a chair leaning forward, which was enough to ignite a buying frenzy among amateur traders. The renewed interest in meme stocks led to a surge in AMC’s stock price, with shares jumping 94% following news of the equity sale. The stock experienced significant volatility throughout the day, eventually closing up more than 78% at $5.19. This resurgence in the meme stock craze also impacted other companies like GameStop, which saw its stock price surge 74% on Monday.
Citigroup, Barclays, B. Riley Securities, and Goldman Sachs acted as the sales agents for AMC’s equity offering. These institutions played a crucial role in facilitating the sale of the 72.5 million shares, helping to secure the $250 million in new equity capital for the company. The involvement of these reputable firms added credibility to the offering, further boosting investor confidence in AMC’s financial position.
AMC Entertainment’s successful equity offering and the resurgence of the meme stock craze exemplify the impact of retail investors and social media on the financial markets. The company’s ability to raise $250 million in new equity capital amidst heightened market volatility underscores the power of online forums and influencers in driving stock prices. As the meme stock phenomenon continues to evolve, companies like AMC and GameStop will need to navigate this new era of retail investor participation and market speculation.
Leave a Reply