Mudrick Capital Management LP, the hedge fund that AMC Entertainment Holdings Inc. provided a much-needed lifeline in December, sits on hundreds of millions of dollars in gains following the price of AMC’s stock last week.
The New York-based company made $ 200 million in profits, mostly from its stake in AMC debt, according to a person familiar with the case.
Mudrick’s profits come from a combination of paper profits and realized trades, the person said.
Last week, AMC shares nearly tripled in value as the movie theater chain’s shares caught the attention of individual investors swarming around popular Reddit forums chasing the dizzying rally in GameStop Corp. stock. wanted to repeat.
However, most of Mudrick Capital’s profits come from its holdings in the company’s bonds, which rebounded as the company’s stock price rose.