Alamo Drafthouse Has Filed For Bankruptcy, But Only A Few Locations Will Be Closing
It's no secret that the coronavirus pandemic has been hitting the movie theater industry hard. Sadly, one of the best movie theater chains around has filed for bankruptcy and will soon be under partially new ownership.
The Texas-based movie theater chain Alamo Drafthouse announced that they have filed for Chapter 11 bankruptcy as part of an asset purchase agreement with Altamont Capital Partners, a previous investor in the company, as well as affiliates of Fortress Investment Group, a new financial backer for the chain. This means that operations for Alamo Drafthouse theaters will continue as normal, but a few underperforming locations will be closed as part of the company's restructuring.
Variety has the news on the Alamo Drafthouse bankruptcy, where the "process and sale will give it the capital it needs to continue operating" after the coronavirus pandemic kept many of its locations closed for months. Even after theaters were allowed to reopen, the lack of big, new movies and a willing audience meant Alamo Drafthouse locations were still hurting.
At this time, a complete list of locations that will be closing was not made available. But Alamo Drafthouse has unfortunately already bid farewell to the downtown Austin location known as The Ritz, which has been open for nearly 13 years. In a statement on their website, Alamo Drafthouse said:
"Last March, we temporarily closed The Ritz along with every other Alamo Drafthouse location. Nearly one year later, we're incredibly sad to tell you that because of the ongoing impact of COVID, we will not be reopening The Ritz.To our guests – thank you for your continuing support. Post-COVID, we'll make certain that all of our signature series will find a new home at another Austin Alamo Drafthouse Cinema, and that the spirit and personality of The Ritz will continue.To the team members who built and sustained The Ritz – thank you, thank you, thank you. You, your sweat, and your passions are what made the Alamo Drafthouse at the Ritz a unique and wonderful home for so many communities in Austin.And to everyone... Remember the Alamo Drafthouse Ritz."
As Alamo Drafthouse changes hands, there will still be some familiar faces around. Founder Tim League will still be involved with the company by way of the lender group buying the company's assets. He'll also be joined by executive chairman Shelli Taylor, a former Starbucks executive who will now be serving as CEO of Alamo Drafthouse. Taylor said in a statement:
"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. 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."
Though it's reassuring to hear that Alamo Drafthouse will mostly remain up and running, this makes us wonder if unique repertory screenings and events like Fantastic Fest will continue. These were fun for fans, but they're not always especially profitable. So there's a chance the new owners may not be so keen on keeping them around as they try to turn the company around after this crisis.