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AMC Major Stakeholder Wanda Converts Stock To Allow For Sale Amid WallStreetBets Frenzy

A major Chinese investor in AMC Entertainment Holdings Inc (NYSE: AMC) converted its shares in the cinema operator in order to be able to sell them, according to a filing with the U.S. Securities and Exchange Commission. 

· 02/08/2021 01:58

A major Chinese investor in AMC Entertainment Holdings Inc (NYSE:AMC) converted its shares in the cinema operator in order to be able to sell them, according to a filing with the U.S. Securities and Exchange Commission. 

What Happened: Wanda America Entertainment Inc, a unit of Beijing-based Wanda Group, converted its Class B common stock to Class A AMC shares on Feb. 1 “in order to permit sales of its common stock,” according to the filing. 

No details of how much stock was converted were given out in the SEC document. 

The Chinese conglomerate had acquired the majority stake in AMC for $2.5 billion in May 2012.

Why It Matters: AMC is still a majority-owned subsidiary of the Wanda Group, as per the latter’s website.

The theater chain along with GameStop Corp. (NYSE:GME), Blackberry Ltd (NYSE:BB), and Nokia Oyj (NYSE:NOK) are targets of r/WallStreetBets, a Reddit forum, that has been carrying out a short squeeze in recent weeks.

The short squeeze has caused institutional short-sellers such as Melvin Capital and Citron Research to pose losses as they cover their shorts.

The Reddit investors received support from celebrities, investors, and others like Mark Cuban, Dave Portnoy, Tesla Inc (NASDAQ:TSLA) CEO Elon Musk, and others.

See Also: Dave Portnoy Stakes $700K On AMC Again After Exiting All 'Meme Stocks'

In late January, AMC shares shot up as much as 804% at one point. The stock is up over 200% on a YTD basis as of Friday’s closing. 

Price Action: AMC shares closed nearly 3.7% lower at $6.83 on Friday and gained almost 0.6% in the after-hours session.

Read Next: AMC Explores Another Stock Sale Amid Reddit-Fueled Rally: Report

Photo courtesy: Coolcaesar via Wikimedia