AMC’s Deutsche Bank Debt Deal Rewards Market Return Within Year

Article content(Bloomberg) — AMC Entertainment Holdings Inc. turned to an existing creditor to refinance debt after turbulence in public markets derailed a planned bond and loan sale — though the deal includes incentives to bring it back to investors before long.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe cinema chain operator on Friday unveiled an agreement with Deutsche Bank AG for a $425 million senior secured credit facility to repay its Odeon unit’s 12.75% notes due in November 2027. As a result, AMC shelved an offering of about $2.5 billion in debt that would also have refinanced its Muvico unit’s $2 billion loan maturing in 2029. Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThe deal with Deutsche Bank has a provision that encourages AMC to pursue a broader refinancing within a year, according to people familiar with the matter. Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentIf the company refinances its Muvico and Odeon debt within that time, it can repay the new loan at 102 cents on the dollar, the people said, asking not to be identified because the discussions are private. Refinancing just the loan on its own would come at a higher cost under a two-year non-call provision.Article contentThe agreement underscores how indebted firms and banks are seeking alternatives at a time when AI-driven disruption fears and an escalating conflict in the Middle East have pushed up refinancing costs in the US leveraged loan market.Article contentFirms including C&D Technologies Inc and Herbalife Ltd. have also shelved loan offerings in the past few days, while Consolidated Energy Ltd. and Arclin Inc. priced deals at steep discounts. Article contentThe new credit facility is expected to “strengthen the company’s balance sheet, extend debt maturities, and reduce interest rates while preserving flexibility to streamline and simplify the capital structure,” AMC said in its Friday statement. Article contentThe company didn’t immediately respond to a request for comment. A Deutsche Bank spokesperson declined to comment. Article contentAMC sees a “significant opportunity” to continue closing underperforming theaters and is betting that a strong slate of films planned over the next couple years will improve its fortunes, executives said during a call with analysts last month. Article content—With assistance from Thomas Buckley.Article contentTrending Here's why bets are rising for interest rate hikes including for Canada Economy Subscriber only. It's been five years since mortgage rates hit all-time lows, and no one is celebrating this anniversary Subscriber only Personal Finance Oil wipes out gains to trade below US$90 in wild trading session Oil & Gas Canadians blasé about CUSMA misunderstand the market risks Investor Posthaste: How $100 oil could do Canada's economy more harm than good News Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Here's why bets are rising for interest rate hikes including for Canada Economy Subscriber only. It's been five years since mortgage rates hit all-time lows, and no one is celebrating this anniversary Subscriber only Personal Finance Oil wipes out gains to trade below US$90 in wild trading session Oil & Gas Canadians blasé about CUSMA misunderstand the market risks Investor Posthaste: How $100 oil could do Canada's economy more harm than good News