Alamo Drafthouse, the independent theater chain known for its dine-in meal service, including food and drink specials inspired by films, has filed for Chapter 11 bankruptcy. The Austin-based chain’s assets will be sold to private-equity firm Altamont Capital Firms, a previous backer of the company, and affiliates of investment management firm Fortress Investment Group, Variety reports. Tim League, co-founder and executive chairman of Alamo Drafthouse, is among the group of buyers and will continue to be involved with the company.
“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,” CEO Shelli Taylor said in a statement.
The size of Alamo Drafthouse — with estimated assets valued between $100-$500 million, and an equal amount of estimated liabilities— makes this one of the “highest-profile casualties of the pandemic,” per Deadline. Coronavirus-related closures and capacity restrictions have decimated parts of the entertainment industry, including cinemas. At the beginning of the pandemic, Alamo Drafthouse closed its theaters and furloughed employees; many of those furloughs became permanent layoffs in July.
The first Alamo Drafthouse opened in Austin in 1997 and soon became a haven for film geeks. It hosts premieres and Q&As, and its screenings have strict no talking policies (except for specific screenings where talkback is encouraged). Among its themed menu items have been beef bulgogi pizza inspired by Parasite and an Avengers: End Game burger,
Despite its popularity, the company has also been the flash point of controversy, facing multiple accusations of “sexual harassment and abuse, racist attitudes toward customers, unsafe (and often illegal) work environments, and even stories about ticket sales being shorted to add to Drafthouse’s own coffers,” according to IndieWire.
As states continue to re-open amid the pandemic, Alamo operations are mostly expected to continue normally. A few of the chain’s 41 locations across the country will shutter as part of this restructuring process.