Discovery Capital Management has made a huge bet on AMC Entertainment.
The macro hedge fund firm headed by Tiger Cub Robert Citrone disclosed Tuesday evening in a regulatory filing that it had acquired more than 29.5 million shares of the movie theater giant’s stock, bringing its total holding close to 29.65 million shares, or nearly 7 percent of the company’s total.
AMC is now Discovery’s largest U.S.-listed common stock long position, according to regulatory filings. It is also the fourth-largest overall position, Citrone says. The investment was filed on a Form 13G, indicating it is passive.
AMC has about 870 theatres and 9,700 screens throughout the world, the company says. It has struggled for several years, hurt by attendance declines since the pandemic, the boom in streaming, and huge debt.
Discovery initially invested in the company several years ago, when it bought AMC’s 10 percent notes in the secondary market. In 2024, Discovery exchanged the notes for convertible securities, and earlier this month exchanged those for equity — hence the filing.
Discovery is excited about AMC’s prospects — in contrast with Wall Street’s sell-side set, whose consensus recommendation is to just “hold” the stock.
Earlier this month, the company settled litigation with certain holders of its 7.5 percent senior secured notes due in 2029. Under the deal, the creditors will provide about $223.3 million of new financing and exchange $590 million of existing 7.5 percent notes due in 2029. The $223 million in new capital will be used mostly to refinance debt maturing in 2026.
As part of the comprehensive financing and settlement, Discovery partly exchanged its converts for equity. “With reduced debt, fresh capital for 2026 maturities, and litigation fully resolved, AMC is operating from a position of renewed strength and optimism,” said Adam Aron, AMC’s chairman and CEO, in a press release.
The refinancing is expected to lower interest expense, increase cash flow, and improve the company’s ability to take advantage of the improving box office. Discovery anticipates that AMC will refinance a term loan in January at lower rates.
Meanwhile, box office attendance is improving. The domestic box office is on track to be 15 to 20 percent higher than in 2024, according to both Citrone and a senior Discovery capital investment member[WM(1] . AMC also is generating more profit per theater patron than in the past, in part thanks to sales of ancillary services and merchandise, they note. So Discovery believes that if the 2025 box office expectations come to fruition, AMC will be close to being free cash flow–positive.
Discovery, a hybrid of a macro fund and a fundamental global equities firm, was up 12.5 percent in the first half of 2025.
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