The $4.8 Billion Reason Nobody Wants to Buy AMC Entertainment Just Yet

The rumor makes sense: E-commerce giant Amazon (NASDAQ: AMZN) has shown interest in the movie industry in the past, and as long as the audience for Amazon Studios' productions is limited to Prime members, the company is leaving money on the table. If it acquired movie-theater giant AMC Entertainment (NYSE: AMC), Amazon would shift into the mainstream of the film industry, and its ability to screen its releases would allow them to qualify for Hollywood's awards. It would also offer Amazon a way to expand its subscription ecosystem.

But there's one key reason that would make Amazon -- or any other prospective suitor -- hesitate to scoop up AMC at any price. The theater chain is weighed down by $4.8 billion worth of debt, which has proven to be the difference between a profit or loss for the past three years. As long as AMC is servicing this debt, it's unlikely to be viable.

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Source Fool.com