Shares of AMC Entertainment Holdings (NYSE: AMC) slid in pre-market trading at the time of writing on Thursday, while AMC’s Preferred Equity Units (APE) surged. This comes after Special Master Corinne Elise Amato, appointed by Delaware’s Court of Chancery to weigh in on the range of objections to the proposed settlement, issued a general recommendation in favor of approving the agreement.
Earlier this year, AMC had proposed a plan to convert APEs into common stock, implement a 1-for-10 reverse stock split, and issue shares to raise more funds. However, this plan ran into a class action litigation, and the Special master’s approval is related to this lawsuit.
Special Master Amato stated in her report, “”I recommend that the Court DENY the Objections to the Settlement as set forth herein.” Any exceptions or recommendations to the special master’s report will need to be filed by June 28, followed by a two-day settlement hearing on June 29 and 30.
Following this hearing, the vice chancellor will issue the final word on the settlement.
Analysts remain bearish about APE stock with a Moderate Sell consensus rating based on two Holds and three Sells.
