Mudrick Capital Management LP, the hedge fund that provided a much-needed lifeline to AMC Entertainment Holdings Inc. in December, it is earning hundreds of millions of dollars in earnings after last week’s rise in the price of AMC shares.
The New York-based firm made $ 200 million in profits, mostly from its holdings in AMC debts, according to someone familiar with the matter.
Mudrick’s earnings are derived from a combination of paper gains and operations performed, the person said.
Last week, AMC’s shares nearly tripled in value as the film chain’s shares caught the attention of individual investors swarming popular Reddit forums who wanted to repeat the dizzying rally seen in shares of GameStop Corp.
However, most of Mudrick Capital’s gains come from its holdings in company bonds, which increased as the share price increased.