Amazon's (potential) AMC acquisition is the talk of the town — here's how it could go
Amazon and AMC sittin’ in a tree... M-E-R-G-I-N-G. Just as unconfirmed as that 2nd grade rumor about Billy and Sally, but more interesting. According to British tabloid Daily Mail (which we take with large grains of salt) Amazon is considering buying AMC. This potential melange piqued our acquisition fantasy (and made AMC stock soar 30%). Here's what Amazon could get:
- (More) Influence: With 11K+ screens, AMC is the largest movie theater chain in the world — this would provide Amazon (even) more global reach. AMC also exerts significant influence over movie studios and execs (see: Trolls sequel drama).
- (More) Prime benefits: Amazon could provide discounted movie tix for Prime members and/or free screenings for Amazon Studio-made films. Netflix bought movie theaters in NY and LA to screen its own films, but on a much smaller scale.
- Also, Amazon is richer than ever on soaring sales, while AMC's stock value has collapsed 30% since late Feb — so it would be acquirin' at a discount.
Amazon wants it all... This reported acquisition can also be explained by Amazon's proclivity to world domination. It dominates ecommerce, it leads in cloud computing, it took on streaming, it birthed Alexa, and it even got into the grocery game. Now it would be coming for movie theaters.
But maybe AMC isn't the best acquisition target... Amazon's other physical retail-acquisition (Whole Foods) hasn't yet achieved its "affordable for everyone" promise, and Amazon's grocery operation is still lagging behind major retailers. Also, AMC is saddled with almost $5B in debt and a loss-making biz — that would become Amazon's problem if Bezos snatched it up.