Shares of AMC Entertainment Holdings (NYSE: AMC) rose in pre-market trading on Thursday after a U.S. Court denied the theater chain’s request to lift a status quo order. The lifting of this order was necessary to start a series of transactions to convert AMC’s preferred stock units (APE) to common stock.
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Delaware Chancery Court judge Morgan Zurn stated, “The parties offer no good cause to lift the status quo order.” Following this news, APE shares were down by more than 12% in pre-market trading on Thursday.
AMC stated that it was “continuing to evaluate the next steps” after the Court’s decision.
Earlier, AMC investors had sued the company and alleged that several of its directors had violated a law by creating the preferred shares in order to deprive the voting power of common shareholders who were against the issuing of new shares.
Earlier this week, the company settled with some of its shareholders and stated that it would ask the judge to lift the status quo order to complete the conversion.
Even with today’s price surge, AMC stock has tanked by more than 65% in the past year.