Alamo Drafthouse files for Chapter 11 bankruptcy due to pandemic
AUSTIN, Texas - The dine-in theater chain Alamo Drafthouse is the latest casualty of the coronavirus pandemic.
The Austin-based company filed for Chapter 11 bankruptcy on Wednesday. The company said it hopes to find a buyer, which will allow it to continue operating while its managers and advisors work on repaying creditors.
"The transaction will provide the company with much-needed incremental financing to stabilize the business during the pandemic, which has had an unprecedented and outsized impact upon the movie theater and dining industries," the company said in a statement. "More importantly, it will position Alamo Drafthouse to return to growth and continue executing on its long-term strategic vision."
Alamo Dafthouse has more than 40 theaters across the United States. It plans to permanently close a few underperforming locations and restructure its lease obligations.
That includes its iconic Ritz location in downtown Austin, which like many of its theaters temporarily closed in March 2020 due to the ongoing impact of COVID-19.
Alamo tried to reopen its six locations in North Texas in late August but ultimately shut the doors again in September and October because of a lack of business.
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At the time, the company said it tried to keep the theaters in Lake Highlands and Richardson open. But with no big movie releases coming, it made more sense to close and try to wait out the pandemic.
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Associated Press contributed to this report.