AMC is diversifying in a direction that no one saw coming. The movie theater chain announced Monday it had bought a 22% ownership stake in a Nevada-based precious metals mining company.
CEO Adam Aron, on Twitter, announced the investment in Hycroft Mining on Tuesday morning, noting that the company has 15 million ounces of gold resources and 600 million ounces of silver resources. The entertainment company spent $27.9 million in cash on the investment.
Aron said AMC plans to use “Our expertise to help them bolster their liquidity.”
AMC is playing on offense again with a bold diversification move. We just purchased 22% of Hycroft Mining (NASDAQ: HYMC) of northern Nevada. It has 15 million ounces of gold resources! And 600 million ounces of silver resources! Our expertise to help them bolster their liquidity. pic.twitter.com/LihqZguwnd
— Adam Aron (@CEOAdam) March 15, 2022
AMC is playing on offense again with a bold diversification move. We just purchased 22% of Hycroft Mining (NASDAQ: HYMC) of northern Nevada. It has 15 million ounces of gold resources! And 600 million ounces of silver resources! Our expertise to help them bolster their liquidity. pic.twitter.com/LihqZguwnd
“[This] is a truly terrific opportunity to potentially strengthen and enrich our company, and thereby create significant value for AMC Entertainment shareholders,” said Aron in a statement. “One would not normally think that a movie theatre company’s core competency includes gold or silver mining. In recent years, however, AMC Entertainment has had enormous success and demonstrated expertise in guiding a company with otherwise valuable assets through a time of severe liquidity challenge, the raising of capital, and strengthening of balance sheets, as well as communicating with individual retail investors. It is all that experience and skill that we bring to the table to assist the talented mining professionals at Hycroft.”
Hycroft is a penny stock and saw its share price soar Tuesday on the announcement, jumping more than 92% in pre-market trading.
AMC is working alongside metals investor Eric Sprott, who will buy an equal number of shares and warrants, in the deal.
The deal split the AMC Apes, the enthusiastic retail investors who drove up the company’s share prices over the past year. Some were wildly enthusiastic, while others (including investors who aren’t part of the Ape Army) were quite the opposite.
Lol. What?!?! This is one baller ass move lol. And here I was thinking I was investing in a movie company and you're out here buying gold and silver mines 🥵🥵🥵🥵.
— Zero (@Zero___Gundam) March 15, 2022
Lol. What?!?! This is one baller ass move lol. And here I was thinking I was investing in a movie company and you're out here buying gold and silver mines 🥵🥵🥵🥵.
This … this is actually brilliant. It’s well aligned with your core expertise: not movies or popcorn, but liquidity games. Bravo.
— TikTok is a PsyOp (@TikTokPsyop) March 15, 2022
This … this is actually brilliant. It’s well aligned with your core expertise: not movies or popcorn, but liquidity games. Bravo.
Never would had seen this coming. Don't think the shorts would had either. Just so off the wall move. I like it.
— Paul Lavigne 🇨🇦 (@PaulLavigne17) March 15, 2022
Never would had seen this coming. Don't think the shorts would had either. Just so off the wall move. I like it.
This move tells me $amc movie business is pretty much dead and executives have no idea what to do.
— IPHawk (@TheIpHawk) March 15, 2022
This move tells me $amc movie business is pretty much dead and executives have no idea what to do.
Soooo, there “could have” been funds available for a dividend after all? Big move, but, your shareholders need some love sir.
— Cody Ault (@houstonkat84) March 15, 2022
Soooo, there “could have” been funds available for a dividend after all? Big move, but, your shareholders need some love sir.
when your business model is so flawed you become a SPAC instead
— PERTINENT PΞN (@PertinentPenArt) March 15, 2022
when your business model is so flawed you become a SPAC instead
How long have I been asleep? Is it April Fools Day?
— A Progressive Libertarian (@Tiggersdad2) March 15, 2022
How long have I been asleep? Is it April Fools Day?
AMC shares spiked as high as $72 in the past year, but in a year-over-year basis, the company’s stock is 3.4% lower than it was on March 15, 2021.
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