Sony Pictures Entertainment has acquired Alamo Drafthouse Cinema, the movie theater chain that has inspired a passionate audience with its creative cocktails, diverse menu and strict “no talking, no texting” policies. The media company acquired Alamo Drafthouse from owners Altamont Capital Partners, Fortress Investment Group and its founder Tim League.
Under its new ownership, Alamo Drafthouse will be managed by a newly created division, Sony Pictures Experiences. In a press release touting the sale, the company said it “reinforces (Sony Pictures Entertainment’s) long-standing commitment to theatrical exhibition and continued experiential entertainment initiatives.” Alamo had been quietly soliciting offers for several months, but had difficulty finding a buyer.
Alamo Drafthouse’s Michael Kustermann will remain CEO of the pioneering movie theater chain and lead Sony Pictures Experiences, reporting to Ravi Ahuja, president and COO of Sony Pictures Entertainment. The chain’s 35 theaters will operate under the Alamo Drafthouse brand. Alamo Drafthouse-owned Fantastic Fest, its popular genre film festival, is included in the acquisition and will also continue to be managed by Alamo Drafthouse. The company’s headquarters will remain in Austin, Texas. It is located in 25 metropolitan areas.
“We strongly believe in engaging entertainment fans outside of the home in a fun and distinctive way,” Ahuja said in a statement. “Alamo Drafthouse’s differentiated movie experience, admired brand and dedicated community align well with this vision. »
Sony has also moved more aggressively into the area of live experiences. Last year, it launched Wonderverse Chicago, an immersive entertainment space featuring “Ghostbusters” and “Jumanji” virtual reality experiences, “Zombieland”-themed bumper cars, “Bad Boys” racing simulators and more. other attractions linked to his films. He also announced a traveling live “Wheel of Fortune” tour, based on the popular game show he produces.
Founded in 1997 by Tim and Karrie League as a single-screen repertory theater in Austin, the company has grown to become the seventh largest theater chain in North America, welcoming more than 10 million visitors each year. Like many movie theater chains, Alamo has been hit hard by the pandemic, with many theaters forced to remain closed or operate at limited capacity for months. It filed for Chapter 11 in March 2021 and emerged from bankruptcy less than four months later. The theatrical box office has suffered in recent years as Hollywood struggled to produce as many films due to COVID-related shutdowns and later the actors’ and writers’ strikes of 2023. However, Alamo, with its base of loyal fans, is doing better than its competitors. Last year, the theater chain saw a 30% increase in box office revenue from the previous year, a much more substantial improvement than the 21% increase the industry saw in its together.
“We are thrilled to join forces with Sony Pictures Entertainment to expand our company’s vision to be the best cinema that has ever existed or will ever exist in ways we can only dream of,” said declared League. “They have a deep respect and understanding of cinema’s ability to drive growth and create lasting cultural impact, which aligns perfectly with everything Alamo Drafthouse stands for.”
Tom Rothman, Chairman and CEO of Sony Pictures, has been one of the biggest proponents of the cinematic experience in the film industry. Even as other major studios moved more aggressively into streaming, reducing the exclusive window during which their films were in theaters or forgoing them altogether, Rothman insisted that his films remain in theaters.
“Alamo Drafthouse has always held in high regard the craft of filmmaking and the theatrical experience, which are fundamental values shared by our companies. I’m excited that our company is doing this,” Rothman said.
Financial terms of the deal were not disclosed. Goldman Sachs acted as exclusive financial advisor to Alamo Drafthouse in connection with the transaction.
Alamo’s Kustermann hailed the deal as historic. And it may not be, but it’s a rare moment in recent history where a studio buys a theater chain. This is something that was made easier after the Paramount Decree, a 1948 Supreme Court antitrust ruling that prevented film production companies from owning exhibition companies, was allowed to expire in 2020. But it doesn’t t’s not the company’s first foray into mining. In the 1990s, as federal regulations eased, Sony owned and operated the Lowes Theater chain.
“We were created by movie fans for movie fans,” Kustermann said in a statement. “We know how important this is to Sony and this is further proof of their commitment to the cinematic experience. Together, we will continue to innovate and bring exciting new opportunities to our teammates and movie fans.
Some streaming companies have already gotten into the exhibition business. Netflix bought two theaters, the Egyptian in Los Angeles and the Paris in New York, and Amazon bought the theater owned by ArcLight in Culver City. It’s unclear whether the sale of Alamo will prompt other entertainment companies to create their own movie theater chains. The National Association of Theater Owners, the exhibition industry’s trade association, expressed cautious optimism after the announcement.
“While there are many details to be revealed and better understood, Sony Pictures’ announcement of its investment in Alamo Drafthouse underscores one key thing we already know: theatrical exhibition is an industry worth investing in. worth investing in,” the organization said. “Sony has long been a strong supporter of theatrical exhibition and Alamo is a leader in creating innovative and fun experiences for movie fans on the big screen. The fact that Sony is making this investment confirms the cultural, experiential and financial value of movie theaters and their place at the center of filmed entertainment.