Adam Aron is making it crystal clear that he knows who is buttering his popcorn these days.
In a Tuesday morning filing,AMC Entertainment
disclosed that it is abandoning its request for shareholders to approve 25 million new shares as part of a planned capital increase that would have allowed the company to leverage its alpha “meme stock” status, but also diluted existing stockholders that are overwhelmingly retail investors who have made their opposition to the plan quite plain on social media.
AMC chief Adam Aron, who has made a habit out of engaging directly with the retail investors that are now thought to hold roughly 80% of his company’s shares, took to Twitter minutes after the filing to let his base know that they were the reason behind his decision.
Accompanied by a picture of the words “I see you, I hear you, I value you,” Aron tweeted that while he still wants the capital from 25 million new shares to pay down AMC’s remaining debt load and give him cash reserves to play with as the the theatre industry recovers, he is acutely aware of the difference in opinion among AMC’s retail base on social media and “does not want to proceed with such a split.”
And he got the reception he wanted. AMC shares popped almost 3% Tuesday morning after falling more than 12% over the last two weeks.
Aron, who has been perhaps the least subtle meme stock CEO when it comes to his thirst for the approval of retail investors. In June, Aron launched an initiative called “AMC Investor Connect” that provided individual investors holding AMC stock with perks ranging from private interactions with Aron himself to free popcorn at AMC theatres.
Ryan Cohen, the newly-installed chairman of the board at GameStop
has also managed to become a niche celebrity in the world of meme stocks, but his engagement with investors has been more oracular than Aron’s, and more akin to the behavior of the OG Memelord CEO: Tesla’s
The request for shareholders to approve the 25 million new shares came shortly after the birth of “AMC Investor Connect,” but it became obvious rather quickly that no amount of free popcorn would get Redditors keen on short squeezing AMC stock to agree to dilute their own shares.
Even when the blockbuster opening weekend of Vin Diesel’s “F9” pulled in $70 million and appeared to show that Americans were getting back in theatres after COVID decimated the industry, Aron’s celebrations were met with cynicism from the retail crowd.
When Aron tweeted on June 28 that “F9” had pushed AMC to “RECORD NUMBERS since re-opening our theatres,” some were quick to clap back.
“See you don’t even need to 25M shares right now,” responded one user almost immediately. “You’re already killing it!!”
On Reddit, AMC’s capitulation was met with celebration from investors who refer to themselves as “Apes” and spent Tuesday morning crowing about Aron’s decision to give many of them exactly what they wanted.
“He did it!” proclaimed zv5000. “Adam Aron f***in took the one thing that was dividing apes and squashed it! KING SILVER BACK BABY!!!!!”
Among retail investors on Reddit, there are few honors higher than being anointed a “silver back.”
While Aron’s case to push harder on the new shares might have been further weakened by the return of the blockbuster machine Marvel Cinematic Universe to screens on Friday in the form of Scarlett Johansson’s “Black Widow,” the AMC chief is not quite done pushing his case to capitalize on his company’s online popularity by issuing new shares in the future.
In a follow-up tweet Tuesday morning, Aron urged his shareholders to vote on the four issues still on the table for AMC’s July 29 meeting and also slipped in a little sneak preview of his own.
“There will be no voting before 2022 on more shares,” Aron tweeted.