The Covid-19 pandemic of 2020 devastated hundreds of businesses in the U.S., forcing several establishments to file for bankruptcy, such as retailers, restaurants, real estate firms and energy companies.
Most people remember the names of many of the restaurants that fell into bankruptcy, including Chuck E. Cheese, Souplantation, Sweet Tomatoes, HomeTown Buffet and Old Country Buffet. Several retail chains, such as JC Penney, Bed Bath & Beyond and a list of movie theater operators also filed Chapter 11.
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Pandemic caused movie theater bankruptcies
Movie theater operator CMX Cinemas filed for Chapter 11 bankruptcy in April 2020 after the Covid-19 pandemic devastated the industry.
Regal Cinemas owner Cineworld also struggled during the pandemic and afterward, as it closed over 50 Regal theaters and filed bankruptcy in September 2022. Cineworld, the second largest theater operator behind AMC, emerged from bankruptcy July 31, 2023.
The movie theater industry has struggled to lure people back into their brick-and-mortar properties after the Covid-19 pandemic, as movie fans have been reluctant to return to indoor theaters after the healthcare disaster. The smaller crowds in movie venues since the pandemic began has led to more theater operators filing bankruptcy.
Iconic movie theater chain Metropolitan Theatres Corp. filed for Chapter 11 bankruptcy protection to reorganize its business affairs, which will include restructuring and possibly rejecting theater leases, company president David Corwin wrote in a bankruptcy declaration.
The Los Angeles-based movie theater chain on Feb. 29 filed its Subchapter V bankruptcy petition in the U.S. Bankruptcy Court for the Central District of California in Los Angeles.
Some movie theater chains that filed for Chapter 11 protection because of the effects of the Covid-19 pandemic , however, emerged from reorganization and are thriving in the business.
A pedestrian walks past Alamo Drafthouse in Austin, Texas, on March 3, 2021. Photographer: Thomas Ryan Allison/Bloomberg via Getty Images
Alamo Drafthouse chain seeking a sale
Dine-in movie theater chain Alamo Drafthouse Cinema has bucked the trend of distressed multiplexes across the nation, as its recent success may have made it attractive for an acquisition. The Austin, Texas, company is seeking a buyer for its 41-theater chain, with 17 franchise-owned sites, located in 13 states, Deadline reported.
Word of the company inquiring about a possible sale came from several unnamed Deadline sources, who also said no asking price has been revealed and there have been no bidders yet.
Alamo Drafthouse, founded in 1997, reportedly generated $134 million at the box office in 2023, which was more than a 25% increase over 2022.
The dine-in movie theater chain in March 2021 filed for Chapter 11 bankruptcy suffering from the effects of the Covid-19 pandemic and emerged from bankruptcy in June 2021 after a sale to an investment group that included Altamont Capital Partners, Fortress Investment Group and founder Tim League.
The theater chain presents the latest motion picture releases, foreign language films or cinematic classics. The theaters’ seats have tables in front of them for guests’ food and drinks that are delivered to their seats. Some theaters also have recliner chairs.
Each location’s menu serves burgers, pizzas, salads, snacks and desserts, and the bar features selections from local craft breweries, as well as innovative cocktails, according to the theater chain’s website.
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