A great recitation and I apoloogize for messing up my timing in my prior posts. I think you're absolutely correct that mgm't had to choose - renegotiating debt covenants or staring down landlords was no longer a viable strategy.
I think it's pretty well demonstrated in other cases that the worst outcome for existing shareholders would've come through Ch.11 (the ultimate cramdown). Most chains couldn't have done what AMC did because their portfolios contained too many outmoded threatres whose film zones had either been plundered or cannibalized by new big boxes to attract an Appollo-type deal (hence the pre-packaged Ch.11 rescues by folks like Anschutz).
I'm not so much a mgm't defender as I'm not a basher. The entire industry was faced with a devil's choice - sit on the sidelines and watch your theatres be destroyed or build and risk self-immolation through the resulting debt mountain (includes theatre leases here as a form of off-balance sheet debt financing).
The only chains to escape the massive fallout were those relatively newer chains like Muvico who were unburdened by a portfolio of 6-8 plexes and smaller chains who didn't have to defend huge geographic areas (like Pacific and Century and unlike Edwards).
The megaplex heralded probably the most disruptive physical plant reinvestment cycle to ever hit the industry (the initial multiplex wave enabled operators with large single screen location to carve their theatres into 4-5 plexes without having to relocate and dispose of a long term lease).
So how do you judge management's choices with 20-20 hindsight?. On almost any scale, I'd have to agree with Ed that AMC, undoubtedly through self-interest (the cornerstone of capitalism), acted in a way that preserved the most value for the existing stakeholders. For example, employees who subsequently lost their jobs would've have been let go in any case.
Did Appollo somehow get more than they should've? Look at how the other deals were structured and judge for yourself in light of how those other existing stakeholders fared through Ch.11.
No one's likely to compare AMC management to GE, but it shouldn't be likened to Worldcom and Enron either.
I guess one can say that a recovery in a stock from a panic low (About $1) in the fall of 00 to 14+ little more than nine months later speaks well of a management strategy. Things are always easy in hindsight. I doubt very much that very many investors thought in the fall of 2000 that AMC was going to survive the maelstrom it found itself in. It just so happens that a bankruptcy would have been messy and less advantageous to Apollo in the process of gaining control. That the common roared back can hardly be judged a charitable move on Apollo's part...it was nothing more than a consequence of the most judicious method of gaining control..which was avoiding bankruptcy. If you enjoyed the ride back so much the better but get off the bus before it heads back to the garage. It has been in the garage since the summer of 01..it has failed to make any new significant high. No growth there.