Amazon (AMZN) may be looking to add to its entertainment portfolio as it has reportedly been in talks with AMC Entertainment (AMC) for a potential sale of the movie theater chain.

AMC Entertainment has been struggling since the coronavirus pandemic forced the closure of its movie theaters. The company failed to make rent payments in April and was downgraded by S & P Global to “default imminent, with little prospect for recovery.”

At the end of 2019, AMC had $5 billion in debt and reported a $149 million in losses. The company announced it had a cash balance of $299.8 million as of March 31.

The Daily Mail first reported Amazon’s interest in AMC, with sources saying the e-commerce giant was in talks about acquiring the movie chain, but it was unclear how advanced the talks were between the two companies.

For Amazon, the move to purchase AMC would sweeten its Prime Video service, adding to the company’s growing collection of movies and TV shows for its Prime subscribers.

AMC is the world’s largest theater operator, with about 1,000 cinemas located worldwide, according to its website. Because of the coronavirus closures, AMC furloughed its corporate workforce and reportedly its company CEO, Adam Aron.

Shares of AMC Entertainment stock were up 28.14% as of 11:05 a.m. EDT on Monday while shares of Amazon stock were up 1.01% at the same time.

The US Justice Department signaled it plans to end the Paramount Consent Decrees, which bar major film studios from owning movie theaters
The US Justice Department signaled it plans to end the Paramount Consent Decrees, which bar major film studios from owning movie theaters AFP / FREDERIC J. BROWN
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