Act III Theatres

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Act III Theatres was an American company that owned movie theater multiplexes and screens principally located in the U.S. states of Texas, Oregon and Washington. The company was in business from 1986 to 1997, when it was sold to Kohlberg Kravis Roberts (KKR). Television producer Norman Lear owned a controlling stake in Act III Theatres through his company Act III Communications. [1] At the time of sale in 1997, Act III Theaters consisted of 124 multiplex theaters operating 793 screens located primarily in San Antonio and Austin, Texas and Portland, Oregon, and was the tenth-largest chain of cinemas in the United States. [2] [3]

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Oregon state of the United States of America

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Contents

Formation of Act III Theatres

Act III Theatres was launched in 1986 with the acquisition of Santikos Theatres in San Antonio. [4] Scott C. Wallace, then a senior executive at AMC Theatres, brought the idea to Act III Communications' president Tom McGrath, having received a waiver from his current employer to pursue the transaction.

Santikos Entertainment is a movie theater and entertainment center chain based in San Antonio, Texas, USA. The company was founded in 1911 by Greek entrepreneur Louis Santikos and was owned and operated by his son, John L. Santikos, until his passing in 2014. In 2015 as part of the estate of the late John L. Santikos, Santikos Entertainment was donated to the San Antonio Area Foundation as a social enterprise to provide a lasting gift to San Antonio.

AMC Theatres Movie theater chain

AMC Theatres is a multi-nation-owned movie theater chain headquartered in Leawood, Kansas, and is the largest movie theater chain in the world. Founded in 1920, AMC has the largest share of the American theater market ahead of Cineworld and Cinemark Theatres.

Tom McGrath (media executive) American businessman

Tom McGrath is an American media executive and the chief operating officer of STX Entertainment and senior managing director of private equity buyout vehicle Crossroads Media. He was formerly the chairman of Key Brand Entertainment, a producer and distributor of live theatre in the United States and parent of website Broadway.com; president and COO of Act III Communications; and executive vice president and COO of Viacom Entertainment Group. He is a seven-time Tony Award-winning producer, a member of the National Recording Academy and a Board member of the International Television Academy. He also serves as a Trustee of The New England Conservatory of Music and the American Repertory Theater at Harvard

The group expanded in 1988 by acquiring Luxury Theaters in Portland from Tom Moyer. [5] [6] Luxury Theaters consisted of 87 cinemas operating 293 screens. The purchase price was $150 million. [7] Subsequent to the acquisition of Luxury Theaters, the company's headquarters was relocated from San Antonio to Portland.

Thomas P. Moyer was an American movie theater chain magnate, real estate developer, and philanthropist from the U.S. state of Oregon. Moyer was known for his lightweight boxing career, his career in entertainment, and for developing several real estate projects, including the 1000 Broadway Building, Fox Tower and Park Avenue West Tower.

Other chains acquired by Act III included Presidio Theaters in Austin. Following the acquisition of Presidio, Act III consolidated its market position by buying AMC's theaters in Austin, creating the dominant theater circuit in that city. To grow its footprint in the Pacific Northwest, Act III acquired Oregon and Washington theaters then owned by Cineplex Odeon. [8]

Pacific Northwest Region that includes parts of Canada and the United States

The Pacific Northwest (PNW), sometimes referred to as Cascadia, is a geographic region in western North America bounded by the Pacific Ocean to the west and (loosely) by the Rocky Mountains on the east. Though no official boundary exists, the most common conception includes the Canadian province of British Columbia (BC) and the U.S. states of Idaho, Oregon, and Washington. Broader conceptions reach north into Southeast Alaska and Yukon, south into northern California, and east to the Continental Divide to include Western Montana and parts of Wyoming. Narrower conceptions may be limited to the coastal areas west of the Cascade and Coast mountains. The variety of definitions can be attributed to partially overlapping commonalities of the region's history, culture, geography, society, and other factors.

Cineplex Odeon Corporation was one of North Americas largest movie theatre operators

Cineplex Odeon Corporation was one of North America's largest movie theatre operators, with theatres in its home country of Canada and the United States. The Cineplex Odeon Theatres are now operated by Cineplex Entertainment in Canada and as AMC Theatres in the United States. The company was the result of a merger between Cineplex Corporation and Canadian Odeon Theatres in 1984. Canadian Odeon Theatres was the result of a merger between Canadian Theatres and Odeon Theatres of Canada in 1978.

Acquisition by KKR

KKR acquired Act III Theatres in October 1998 for $323 million plus the assumption of $338 million in debt. The price represents and estimated 11.2x trailing cash flow and 8.8x pro forma cash flow. EBITDA for the group was $59 million for the 12 months ended December 31, 1996. [9] At 11.2x trailing earnings, the acquisition of Act III represented one of the highest valuations ever paid for a chain of movie theaters. Later in 1998, KKR combined its theater operations with the United Artists Theatres held by Hicks Muse and together they acquired Regal Cinemas, creating what is today the largest chain of cinemas in the United States (which operates under the Regal name). In 1990, during the height of the 1990–92 recession, Boston Ventures placed a value on Act III Theatres of 4-5x cash flow while advising majority owner Norman Lear. Simultaneously, Boston Ventures was seeking to acquire various Act III assets. [10] [11]

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References

  1. ↑ "KKR, Hicks Muse to Combine Theater Chains, Acquire Regal" Wall St. Journal January 20, 1998
  2. ↑ Austin-American Statesman October 21, 1997
  3. ↑ Variety August 5, 1997
  4. ↑ "Interview with John Santikos 2002 Institute of Texan Cultures Oral History Collection". Archived from the original on 2014-12-15. Retrieved 2014-11-01.
  5. ↑ Eugene Register-Guard November 23, 1988
  6. ↑ TMT Development
  7. ↑ "Act III Completes Purchase of Theaters" Los Angeles Times May 3, 1989
  8. ↑ John Hartl Cineplex Odeon To Sell Some Theaters In Region Seattle Times June 8, 1992
  9. ↑ SEC 1996 10K-405 Item 6 Selected Financial Information
  10. ↑ "KKR, Hicks Muse to Combine Theater Chains, Acquire Regal" Wall St. Journal January 20, 1998
  11. ↑ "Getting it on in Act III" Variety October 16, 1997
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