Sony Pictures Entertainment has made a groundbreaking move in the entertainment industry by acquiring Alamo Drafthouse Cinema and taking over its 35 locations. This acquisition marks a rare instance of a traditional Hollywood studio owning a theater chain, following the Justice Department’s decision to rescind the Paramount consent decrees in 2020.
The deal, announced on Wednesday, paves the way for Sony to manage Alamo Drafthouse’s theaters, which are known for their distinctive programming and food offerings aimed at attracting moviegoers away from major multiplexes. The terms of the deal were not disclosed, but Sony purchased Alamo from Altamont Capital Partners, Fortress Investment Group, and the chain’s founder, Tim League.
Alamo Drafthouse, the seventh-largest theater chain in North America, has faced financial challenges recently, with several franchised locations filing for bankruptcy and closing. Sony’s acquisition could serve as a lifeline for the struggling chain, which filed for Chapter 11 bankruptcy protection in 2021 before being rescued by a private equity firm.
Despite the acquisition, the cinemas will continue to operate under the Alamo Drafthouse brand, with Sony forming a new division led by Alamo’s chief executive, Michael Kustermann, to manage the theaters. Sony Pictures Motion Picture Group CEO Tom Rothman expressed excitement about the shared values between the two companies, emphasizing their mutual appreciation for the craft of filmmaking and the theatrical experience.
The entertainment industry has faced challenges in recent years, with the pandemic causing a decline in box office receipts and Hollywood strikes impacting the number of movies produced by studios. Ticket sales in the United States and Canada for the year to date have dropped by 26 percent compared to the same period last year, according to Comscore.
Sony’s acquisition of Alamo Drafthouse Cinema represents a significant development in the evolving landscape of the film business, potentially opening the door for other leading studios to make similar moves in the future. As the industry continues to navigate changing consumer preferences and economic challenges, this acquisition could have far-reaching implications for the future of movie theaters and the cinematic experience.
