Alamo Drafthouse Files for Chapter 11, Movie Theater Chain Sells Assets to Altamont and Fortress
Two Texas theaters and one in Kansas City will be closed, development in Orlando to be “permanently ceased”
Alamo Drafthouse has filed for Chapter 11 and sold all of its assets to its senior leadership group, including Altamont Capital Partners, funds managed by affiliates of Fortress Investment Group LLC (“Fortress”), founder Tim League, and other original investors. League is the founder and executive chairman of Alamo Drafthouse, so the movie-theater franchise is (somewhat) staying within the family.
Not without any changes, however: Two Texas theaters and one in Kansas City, Missouri are set to be closed. Development in Orlando, Florida will be “permanently ceased.”
“Alamo Drafthouse had one of its most successful years in the company’s history in 2019 with the launch of its first Los Angeles theater and box office revenue that outperformed the rest of the industry,” Alamo Drafthouse CEO Shelli Taylor said in a statement on Wednesday. “We’re excited to work with our partners at Altamont Capital Partners and Fortress Investment Group to continue on that path of growth on the other side of the pandemic, and we want to ensure the public that we expect no disruption to our business and no impact on franchise operations, employees and customers in our locations that are currently operating.”
“Because of the increase in vaccination availability, a very exciting slate of new releases, and pent-up audience demand, we’re extremely confident that by the end of 2021, the cinema industry – and our theaters specifically – will be thriving,” League said. “We are fortunate to have an incredibly talented and passionate team who are eager to welcome our loyal fans back to our theaters for a cinematic experience that can’t be replicated. That said, these are difficult times and during this bankruptcy we will have to make difficult decisions about our lease portfolio. We are hopeful that our landlord and other vendor partners will work with us to help ensure a successful emergence from bankruptcy and viable future business.”
Alamo was founded in 1997 in Austin, Texas and now has expanded to 41 locations nationwide, including recently in downtown Los Angeles. The brand came to be known for its premium in-theater dining options and has developed a loyal fanbase over the years thanks to its strict policy on cellphone usage inside the theater and its curated events and screening series beyond just showing new titles.
Alamo early on in the pandemic was quick to institute a mask mandate at its theater locations that were allowed to remain open, and just this week as Texas lifted its statewide requirement on masks, Alamo stood firm and said that masks would still be required in its theaters. Alamo had also offered patrons to rent out an entire theater and screen certain movies, both new and old, as a way of providing a safer viewing option during the pandemic, a model that other theater chains followed.
More to come…
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