Exhibition giant AMC Entertainment — created just under a year ago with the merger of AMC and Loews Cineplex — is planning an initial public offering.
Chain is the nation’s second largest after Regal Entertainment with 411 theaters and 5,635 screens — about 80% in the U.S. and Canada. It has a major presence in urban markets including Chicago, Boston, Dallas and New York City, thanks in part to Gotham-based Loews.
AMC parent Marquee Holdings is controlled by a group of private equity firms including Apollo Management, J.P. Morgan, the Carlyle Group, Bain Capital and Spectrum Equity Investors. Apollo and J.P. Morgan acquired publicly traded AMC in 2004 and took it private. The other three firms did the same with Loews.
AMC’s IPO follows the typical trajectory of private-equity deals as the firms take a company private, shape it up and put it back on the market. The offering is their so-called exit strategy, or how they get their payback.
AMC and Loews were key players in the crackup and consolidation of the theater biz in the late 1990s. The chains took on immense debt to build new theaters and shutter old ones and many, including Loews, filed for bankruptcy. They both acquired several smaller chains, then merged with each other.
The company’s IPO registration statement filed with the SEC on Monday noted that costs as a percentage of revenue had dropped over the past year to about 63% from 67%. Revenue per patron has risen at a compound annual growth rate of 5.1% from 2001-06.
The combined company had revenue of $2.4 billion for the year ended Sept. 28, according to the filing.
Losses from continuing operations were $190 million.
Move will give investors the chance to buy shares in another movie theater chain. The only ones publicly traded now are Regal and Carmike Cinemas.
AMC didn’t discuss the number of shares it will sell, or possible pricing. Those details will come later.