Alamo Drafthouse announced on Wednesday morning that it is filing or Chapter 11 bankruptcy protection as it tries correct its financial position.
The filing states that Alamo is entering a restructuring agreement that will see assets sold to Altamont Capital and Fortress Investment Group. Tim League, one of the co-founders of Alamo Drafthouse as well as its executive chairman, will also be a buyer.
Alamo Drafthouse is estimated to have between $100 to $500 million in assets, with estimated liabilities between $100 to $500 million.
“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,” says League in a statement. “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.”
With distribution of the vaccine increasing, and more states opening up, movie going should increase rapidly. A return to pre-Covid numbers by the end of 2021, however, does seem an overly optimistic opinion. Most analysts are saying late 2022 or possibly early 2023 before ticket sales return to those numbers in a best case scenario.