Austin, Texas — Alamo Drafthouse Cinema has filed for Chapter 11 bankruptcy protection and entered into an asset purchase agreement with its group of senior lenders that is led by California-based Altamont Capital Partners and Fortress Investment Group.
The agreement involves the sale of “substantially all” of the company’s assets, though it remains unclear how many of its 41 theaters Alamo Drafthouse plans to close. As part of its filing, Alamo Drafthouse has asked the U.S. Bankruptcy Court for the District of Delaware to approve a 75-day timeline for restructuring its debt and has secured $20 million in debtor-in-possession financing from its creditors to cover operational costs during that period.
The company, which operates some of its theaters and franchises others, cited the COVID-19 pandemic’s “unprecedented and outsized impact upon the movie theater and dining industries” as the central driver behind its decision. Alamo Drafthouse, founded in Austin in 1997, was one of first entertainment concepts to bring elevated food and beverage offerings into the theater space.
SOURCE: www.REBusinessOnline.com