(Bloomberg) — AMC Entertainment Holdings Inc. gained Tuesday, extending last week’s rally, after raising $230.5 million with a stock sale to Mudrick Capital Management as the movie-theater operator pledged to “go on offense” with acquisitions. The agreement with New York-based Mudrick is for 8.5 million shares of common stock at $27.12 apiece, 3.8% more than Friday’s closing price, AMC said Tuesday. With AMC shares now above Mudrick’s purchase price, the sale “sounds expensive” as current debt and equity indicate an enterprise value of more than $16 billion, Michael Pachter of Wedbush Securities said in an email to Bloomberg. If it returns to pre-Covid levels, AMC could optimistically reach around $1 billion in earnings after adjustments — which is above the $929 million the company attained in 2018. Pachter said. “Mudrick must know something I don’t.” AMC plans to use the cash proceeds from the sale for acquisitions of additional theater leases, as well as investments into AMC’s existing theaters, the company said in a statement. It is in discussions with multiple landlords of theaters formerly operated by Arclight Cinemas and Pacific Theatres, Chief Executive Officer Adam Aron said. “We still don’t know exactly what” AMC is buying, “but whatever they acquire is likely to come with additional lease expense and will not be large enough to materially alter our view of the company’s cash flow and leverage profile,” S&P Global Ratings analyst Scott Zari said in response to questions from Bloomberg. “I would be be surprised if Mudrick was buying at a premium now, expecting the shares to go up,” Matt Zloto co-head of U.S. high-yield research at CreditSights said in an interview. “It’s more likely the firm already sold or is selling the shares,” consistent with where equity has been trading, he said. Mudrick’s stock purchase comes with the caveat that the shares be “freely-tradeable”, meaning the firm could sell the shares at any point or in any size it chooses. That would provide Mudrick with 8.5 million shares that could be sold as soon as today. The investment advisor firm has made big bets on AMC in the past, helping the movie theater chain as it pushed through the pandemic. In January, the firm entered into an agreement to buy $100 million of new secured bonds in exchange for a commitment fee equal to about 8 million AMC shares. The agreement also called for Mudrick to exchange $100 million of AMC bonds due 2026 for about 13.7 million shares. Mudrick has benefitted from its ongoing relationship with AMC, working with management on previous deals which have been “a positive for both” AMC and the firm, a “win win,” Zloto said. This sale is the latest of several equity financings conducted by AMC during its meteoric rise this year. It follows the completion of an at-the-market offering in May and a bankruptcy-avoiding financing in January. Tuesday’s deal represents just 1.7% of AMC’s public float as of May 13, according to data compiled by Bloomberg. Nick Note: as usual another Wall Street sleaze deal. The bet here is That after the initial hurrah people will be going back to theaters in mass. I have pronounced the death of the movie theater for over 30 years… and have been wrong. Why people go to those places is beyond me… So we shall see what we see.