Alamo Drafthouse Cinema, an Austin-based dine-in theater chain, is working with Houlihan Lokey as financial advisor as it seeks to raise liquidity to tide it through the Covid-19 pandemic, according to sources. The company
closed all of its locations on March 16 in response to the pandemic and gradually began
reopening them in July.
The company has a L+300 bps $70 million first lien term loan due June 2023, the sources added.
Alamo Drafthouse and its co-founders are being
sued by a landlord for the company’s Austin location for failure to pay rent since April. Press reports
indicate that the company has been hit with a similar lawsuit in San Antonio.
In a Nov. 17
press release, the company said it was auctioning off collectibles, including 2,000 rare prints from co-founder Tim League’s private collection. League said in a statement in the release, “We are legally unable to open many of our venues, and where we can open, our capacity is significantly reduced, the product - the supply of blockbuster films - has evaporated, and our debt from accrued rent during closure continues to mount. 100% of proceeds from the sale will go towards paying staff of the Alamo Drafthouse and paying debt and expenses accrued during the COVID closures. These next four to six months are critical and the proceeds from this auction will help immensely.”
In 2015, financial advisory firm EFA Partners
arranged a $18.6 million financing for Alamo Drafthouse Cinema, which was meant to provide construction capital for Alamo Drafthouse’s new location in Denver while also providing refinancing terms for the existing debt at two other venues in Denver and Austin.
Founded in 1997, the company has 41 locations across 10 states, according to its
website. Private equity firm Altamont Capital Partners
invested in the company in 2018.
Alamo Drafthouse Cinema and Houlihan Lokey did not immediately respond to requests for comment.
--Ellen Schneider, Millie Dent, Harvard Zhang