Mudrick Capital Management LP, the hedge fund that provided a much-needed lifeline for AMC Entertainment Holdings Inc. in December, it has earned hundreds of millions of dollars from last week’s AMC share price rally.
The New York company made a profit of $ 200 million, mostly from its holdings in AMC debt, according to a person familiar with the matter.
Mudrick’s earnings come from a combination of paper gains and transactions, the person said.
Last week, AMC shares nearly tripled in value as movie theater shares caught the attention of individual investors swarming popular Reddit forums seeking to repeat the dizzying rally seen in GameStop Corp. shares.
However, most of Mudrick Capital’s earnings come from its holdings in the company’s bonds, which rose as the company’s share price rose.