It is no secret that the coronavirus pandemic has hit the film industry heavily. Unfortunately, one of the best movie theaters on the market has filed for bankruptcy and will soon be partially under new ownership.
Texas-based cinema 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 the Fortress Investment Group, a new financier of the chain. This means that Alamo Drafthouse’s cinema operations will continue as normal, but some underperforming locations will be closed as part of the company’s restructuring.
Variety broke the news about the bankruptcy of Alamo Drafthouse, where “the process and the sale will give you the capital you need to continue operating” after the coronavirus pandemic kept many of its stores closed for months. Even after theaters were able to reopen, the lack of new big films and a willing audience meant that Alamo Drafthouse’s locations were still hurting.
At the moment, a complete list of locations to be closed has not been made available. But the Alamo Drafthouse has unfortunately already said goodbye to the location in downtown Austin known as The Ritz, which has been open for almost 13 years. In a statement on its website, Alamo Drafthouse said:
“Last March, we temporarily closed The Ritz along with all other Alamo Drafthouse locations. Almost a year later, we are extremely sad to report that, due to the continued impact of COVID, we will not reopen The Ritz.
To our guests – thank you for your continued support. After COVID, we will be sure that all of our exclusive series will find a new home in another Austin Alamo Drafthouse Cinema, and that the spirit and personality of The Ritz will continue.
To the team members who built and supported The Ritz – thank you, thank you, thank you. You, your sweat and your passions have made the Alamo Drafthouse at the Ritz a unique and wonderful home for so many communities in Austin.
And for everyone … Remember the Alamo Drafthouse Ritz. “
As the Alamo Drafthouse changes hands, there will still be some familiar faces around. Founder Tim League it will still be involved with the company through the creditor group that buys the company’s assets. He will also have the company of the executive chairman Shelli Taylor, a former Starbucks executive who will now serve 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 theater in Los Angeles and box office revenue that surpassed the rest of the industry. We are excited to work with our Altamont Capital Partners and Fortress Investment Group partners to continue on this growth path on the other side of the pandemic, and we want to assure the public that we do not expect disruptions to our business and no impact on franchise operations, employees and customers in our locations that are currently operating. “
While it is comforting to know that the Alamo Drafthouse will practically remain in operation, it makes us wonder whether exhibitions of unique repertoire and events like Fantastic Fest will continue. They were fun for the fans, but they are not always especially profitable. Therefore, there is a chance that the new owners will not be as interested in maintaining them as they try to change the situation of the company after the crisis.
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