MoviePass filed paperwork to raise up to $1.2 billion to keep it afloat as it fights AMC

  • On Monday, Helios and Matheson Analytics, the majority owner of MoviePass, filed a shelf registration to allow it to raise more money to help keep MoviePass afloat.
  • The company hopes to raise up to $US1.2 billion in equity and debt.

MoviePass‘ majority owner, Helios and Matheson Analytics (HMNY), filed a shelf registration on Monday in the hopes of keeping the company running for the next few years.

According to the SEC filing, HMNY wants to raise up to $US1.2 billion by offering institutional investors equity and debt.

HMNY CEO Ted Farnsworth told The Hollywood Reporter the money raised would be also be used to make more acquisitions, and he told the trade he’s already in negotiations on a few. Farnsworth also said MoviePass would have 5 million subscribers by the end of the year, and would generate $US600 million in annual revenue.

But increased revenue has also meant increased losses for HMNY.

In June, HMNY said in an SEC filing that MoviePass’ monthly losses soared to $US40 million in May due to rapid increases in subscriber growth. The company also said it expected its cash deficit to reach $US45 million in June. That’s up from nearly $US23 million per month in the first quarter of this year.

That explains the need for extra money – to the tune of $US1.2 billion. Though HMNY is not required to use all the shelf registration, HMNY noted in the June filing that it would “require a significant amount of additional capital for MoviePass” that could potentially exceed $US1.2 billion.

The shelf registration comes at a time when Wall Street doesn’t have a lot of confidence in HMNY and its ability to be sustainable in the long term.

As of Monday morning, HMNY was trading at $US0.26 per share, on the heels of the unpopular news recently that MoviePass will begin to implement “high demand” charges on popular titles beginning this month (essentially surge pricing), and AMC Theatres introducing its own subscription plan.

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