Sony Is Purchasing Popular Alamo Drafthouse Theater Chain

Sony Pictures Entertainment has agreed to purchase Alamo Drafthouse Cinema, a 35-location U.S. theater chain known for creative cocktails and craft food service as well as “no talking, no texting” policies. To manage the acquisition, SPE has established Sony Pictures Experiences, which will be headed by Alamo Drafthouse CEO Michael Kustermann. The exhibitor chain was purchased from founder Tim League, Altamont Capital Partners and Fortress Investment Group, who had quietly been shopping it this past year. Established in Austin, Texas in 1997, Alamo operates in 25 U.S. metropolitan areas and is the seventh-largest theater chain in North America.

Terms of the deal were not disclosed. “We know how important this is to Sony, and it serves as further evidence of their commitment to the theatrical experience,” said Kustermann, who will report to SPE President and COO Ravi Ahuja, as detailed in the company’s announcement.

Sony has “moved more aggressively into the live experiences space” this past year, according to Variety, having in December opened Wonderverse Chicago, an immersive entertainment experience featuring “Ghostbusters” and “Jumanji” VR experiences, “‘Zombieland’-themed bumper cars, ‘Bad Boys’ racing simulators and other attractions tied to its films.”

The New York Times points out that Sony’s acquisition comes after a federal court in August 2020 terminated the Paramount consent decrees, “movie distribution rules dating to 1949 that forced the largest Hollywood studios to sell off their theater holdings” due to antitrust concerns over “controlling the film business, from creation to exhibition.”

That move came at the height of COVID lockdowns, which took a heavy toll on theatrical exhibition. The Alamo Drafthouse filed for Chapter 11 bankruptcy in March 2021 and reemerged just over three months later after the private equity firms stepped in. In 2023, exhibition took another hit from the 2023 actors and writers strikes.

During those tough times “Alamo, with its loyal fanbase, fared better than its competition,” Variety writes, pointing out that “last year, the theater chain had a 30 percent jump in box office revenue from the previous year, a much more substantial improvement than the 21 percent increase experienced by the industry at large.”

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