Over the past 12 to 24 months, we have witnessed many businesses file for bankruptcy. However, what we have also witnessed is many of those businesses springing back to life as a result. This is a key component of Chapter 11 Bankruptcy, and it has, apparently, become the story for theater chain, Alamo Drafthouse.
Alamo Drafthouse is an independent movie theater chain that is famous for their thematic screenings and audience engagement. Until the last few years, they were also unique because they were one of the few movie theaters that offered alcohol, beer (hence, the draft house in their name) and restaurant style food. This unique movie theater experience made them famous and popular, and prior to their bankruptcy filing, they had expanded from one theater to about 40 theaters throughout the U.S. However, during the last 12 months, their business came to an abrupt halt, and they were forced to close their doors and file Chapter 11 bankruptcy.
Emerging from Chapter 11 bankruptcy
In March, the Alamo Drafthouse announced that they had come to a restructuring agreement and would be emerging from Chapter 11 bankruptcy stronger than before. The deal includes new financing and selling assets to Fortress Investment Group and Altamont Capital. As a result, they will not only be reopening their current theaters, but also opening five new theaters over the next 12 to 24 months in Manhattan, St. Louis, Washington, D.C., and Arlington, Virginia. Specifically, in Manhattan, along with a previously announced development in Staten Island, at 28 Liberty, they will open a 14-screen theater. In St. Louis’s Midtown district, they will open a 9-screen theater, along with another 9-screen theater in Washington, D.C., and Arlington, Virginia.
What we can learn
Simply put, we can learn that Chapter 11 bankruptcy is not an end. Indeed, Harrisburg, Pennsylvania, businesses should take this news of yet another Chapter 11 bankruptcy that resulted in a stronger business to heart. Bankruptcy does not have to mean the end of one’s dreams, it can actually be a pathway to a stronger, more profitable business. Though, the first step is contacting an attorney.