In 2012, Dalian Wanda Group Co., a Chinese conglomerate, bought a controlling share in AMC Entertainment Holdings Inc for $2.6 billion. AMC, the world’s largest chain of movie theaters back then, has faced financial challenges recently due to factors like the growth of streaming services and the impact of the ongoing COVID-19 pandemic.
During its latest financial report, AMC revealed that Dalian Wanda has decreased its ownership and voting rights in the company to about 9.8%, down significantly from their previous dominant position of 37.7%. This drop came as AMC experienced a revenue decline of $4.6 billion in 2020 because many movie enthusiasts are reluctant to visit theaters during a pandemic, causing a sharp decline in attendance.
Dalian Wanda has given up its majority control over AMC Entertainment after the world’s largest cinema chain reported a record loss https://t.co/jWLuxnFa9P
— Bloomberg (@business) March 15, 2021
With this reduced ownership, AMC will now operate like other publicly traded firms, with various shareholders influencing decisions, as stated by AMC CEO Adam Aron.
Despite the decrease in Wanda’s stake, it remains the largest investor in AMC. Thanks to the activities of the WallStreetBets subreddit, AMC’s stock has risen. The subreddit’s users bought AMC shares in response to hedge fund managers shorting the stock, leading to a 21% increase in AMC’s stock value at the time of writing.
