Alamo Drafthouse Files For Bankruptcy, Closes Ritz Theater

Austin TX

03 March, 2021

5:20 PM

Description

AUSTIN, TX — Alamo Drafthouse Cinemas said Wednesday it has filed for bankruptcy due to the financial impact of the coronavirus pandemic, according to The Associated Press. The AP reports the company plans to sell most of its assets to affiliates of Altamont Capital and Fortress Investment Group under Chapter 11 bankruptcy, which allows Alamo Drafthouse to continue operating while its managers and advisers work on repaying creditors. "The transaction will provide the company with much-needed incremental financing to stabilize the business during the pandemic, which has had an unprecedented and outsized impact upon the movie theater and dining industries," the company said in a statement. "More importantly, it will position Alamo Drafthouse to return to growth and continue executing on its long-term strategic vision." The cinema franchise was founded in 1997 in Austin by Tim League and his wife Karrie, who were driven by a simple passion for "watching movies and enjoying food and beer", according to the Alamo Drafthouse website. The couple's first theater at 409 Colorado Street was a handbuilt one screen operation that initially featured second run titles at discount rates. Farewell to a friend. https://t.co/Bbtm8C29YP— Alamo Drafthouse ATX (@drafthouse) March 3, 2021 Since opening its doors, the Austin-based company has more than 40 theaters nationwide, including some in the Dallas-Fort Worth area and Kansas City, Missouri. Most of the company's theaters closed in March 2020 but reopened in late summer 2020 with a detailed pandemic protocol plan. On Wednesday, the drafthouse announced it was planning to close Alamo Drafthouse Ritz in downtown Austin due to the coronavirus pandemic. "We're incredibly sad to tell you that because of the ongoing impact of COVID, we will not be reopening The Ritz," the drafthouse said in a statement. "For the past twelve and a half years, The Ritz represented what Alamo Drafthouse theaters could be ... To our guests – thank you for your continuing support." Theaters in New Braunfels and Kansas City, Missouri will also close permanently, according to AP. More from AP RELATED COVERAGE: Texas Reopens: Here's What Austin-Area Officials Are Saying Gov. Abbott Moves 'To Open Texas At 100%,' End Mask Mandate Austin Leaders Not Ready To Declare Victory Over COVID-19