Sony Re-Enters Film Exhibition Business With Alamo Drafthouse Purchase
By Nick Trombola June 13, 2024 11:42 am
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Sony Pictures Entertainment wants a bigger piece of the movie business, but maybe they’re just projecting.
The massive Culver City, Calif.-based studio conglomerate has acquired offbeat dine-in theater chain Alamo Drafthouse Cinema for an undisclosed price from private equity firms Altamont Capital Partners, Fortress Investment Group and Tim League, who founded the theater chain in 1997.
The futures of Alamo’s 35 locations across the country, including its sole Los Angeles location at 700 West Seventh Street in Downtown, are uncertain following the acquisition. Six of Alamo’s franchised locations closed earlier this month — five in the Dallas-Fort Worth area and one in Woodbury, Minn. — after their shared owner filed for Chapter 7 bankruptcy. Alamo itself filed for Chapter 11 bankruptcy in early 2021 in the wake of the COVID-19 pandemic, surfacing later that spring with Altamont, Fortress and others as creditors.
A spokesperson for Alamo Drafthouse did not immediately respond to a request for more information.
For now, Alamo’s CEO Michael Kustermann will continue his role through the acquisition, as well as lead his parent company’s new Sony Pictures Experiences division, according to the L.A. Times, which first reported the news.
Aside from its food and drink services, Alamo is well known for its strict etiquette around movie watching, such as no talking, texting or late admittance. It’s also known for special screenings, regularly hosting “movie parties” centered around certain famous films such as “Back to the Future.”
“Alamo Drafthouse’s differentiated moviegoing experience, admired brand and devoted community fit well with this vision,” said Ravi Ahuja, COO and president of Sony Pictures Entertainment, in a statement. “We look forward to building upon the innovations that have made Alamo Drafthouse successful and will, of course, continue to welcome content from all studios and distributors.”
Most major studios these days have limited stakes in the exhibition side of the movie business — at least in terms of brick-and-mortar theaters. Streaming services have instead become the name of the game for studios such as Paramount and Warner Bros. Discovery, though Sony is the sole major studio without a mainstream streaming service, other than anime streamer Crunchyroll.
Yet box office sales are still struggling to hit pre-pandemic figures. Theaters earned $33.9 billion worldwide in 2023, nearly 25 percent below the $42.3 billion peak hit in 2019, according to analytics firm Gower Street. The firm projected in April that box office revenues this year would finish just shy of last year’s numbers with $32.3 billion.
Nick Trombola can be reached at ntrombola@commercialobserver.com.
