AMC stock drops after court approves ‘APE’ conversion
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AMC Entertainment
It was sinking in late trading on Friday after Bloomberg mentioned The company has received approval to proceed with the planned conversion from AMC Preferred Equity, or APE, units into common shares.
AMC stock (stock ticker: AMC) fell 27% to $3.83. APE units are up 26%.
AMC shareholders voted in the spring to increase the amount of authorized shares, convert APE units into common shares, and implement a reverse stock split. The move was delayed in court after some shareholders sued the company, arguing that its issuance of APE units was intended to circumvent common shareholders’ voting rights.
Although the company settled with the shareholders, it needed approval from the Delaware Court of Chancery to move forward. An initial settlement was rejected. The revised settlement makes more shares available to retail investors.
Write to Connor Smith at connor.smith@barrons.com
