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» Cinematour Forum   » Cinemas in the News   » St. Louis, MO: Wehrenberg Theaters for sale (Page 1)

 
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Author Topic: St. Louis, MO: Wehrenberg Theaters for sale
Kyle Muldrow
Member

Posts: 143
From: Laguna Hills, CA
Registered: Jul 2003


 - posted January 07, 2008 12:19 AM      Profile for Kyle Muldrow   Author's Homepage   Email Kyle Muldrow         Edit/Delete Post 
This could be the beginning of the end of a St. Louis institution. I'm very interested in what my fellow St. Louisans have to say about this. (Sorry about there not being a link...I couldn't get that to work. Any advice on that is welcome.)

Harman Moseley says a "big name theater company" will end up buying Wehrenberg. There are only three that come to my mind: AMC, Regal, and Cinemark. I would favor Regal over AMC, but maybe Cinemark will want to enter the St. Louis market...and what about Starplex?

Fire away...

St. Louis Post-Dispatch (MO)

December 11, 2007

Piracy, digital threaten chain
LARGEST FAMILY-OWNED CHAIN looks for a way out.
INTERNET, HOME THEATERS also pose problems.

Author: Angela Tablac
St. Louis Post-Dispatch

Edition: Second Edition
Section: Business
Page: C1

Index Terms:
Wehrenberg;BUSINESS;MOVIE;SALE;PROPOSAL

Estimated printed pages: 3

Article Text:

Nearly 100 years after Fred Wehrenberg opened the first theater in St. Louis designed specifically for motion pictures, his company - said to be the oldest and largest family-owned theater chain in America - is shopping for a potential buyer.

Executives of Des Peres-based Wehrenberg Theatres, which operates 10 theater complexes in the St. Louis area and five more throughout the Midwest, told more than 800 employees last month that it's exploring a possible sale of its theater operations.

"The industry is consolidating, and the investment required to remain a leader keeps getting larger," spokeswoman Kelly Hoskins said Monday, reading from a prepared statement. "Remaining an effective competitor and continuing entertainment excellence requires a greater financial resource and economies of scale. We've concluded the best action for our company is to be proactive to determine our own future."

Hoskins said the company, which started in 1906 and opened the first motion picture theater in St. Louis in 1910, gets offers from interested buyers "a lot" and finally decided to examine those possibilities. Until a final decision is made, however, the company is "continuing business as normal."

Movie theaters across the nation are battling for business, said Wendy Walker, a securities analyst who covers two publicly traded cinema companies at New York-based Argus Research Co..

Larger chains, operated by companies such as AMC Entertainment Inc. and Regal Entertainment Group, dominate the cinema landscape. Theaters of all sizes compete against the sophisticated home theater and video gaming systems that have been capturing market share, she said.

Plus, movie studios are increasingly delivering movies via digital technology, instead of movie reels, Walker said. That technology costs theaters "hundreds of thousands of dollars" to implement.

Piracy via DVDs and the Internet also poses problems for movie theaters, said local cinema veteran Harman Moseley, who operates the Galleria 6 Cinemas, Moolah Theatre and Lounge, and Chase Park Plaza Cinemas.

"Most recently, 'American Gangster' was available to everyone on a pirated DVD well before the movie opened," he said. "If people are going to be able to get movies off DVDs, why would they pay to see one?"

Wehrenberg Theatres shuttered its Kenrick 8 Cine in Shrewsbury almost a month ago, but Hoskins said that closing is unrelated to the possible sale.

And still, the company continues to expand. It plans to open a 14-screen cinema in Bloomington, Ill., in late January, Hoskins said.

Steve DeBellis said the company's executives "really know the business and they know how to work it." He is author of "100 Years of Reel Entertainment: How Wehrenberg Theatres Became the Longest-Running Picture Show in America," a book published in 2006 and paid for by Wehrenberg Theatres.

"They command the lion's share of the market in their hometown," said DeBellis, who is president of Lemp Brewing Co. in downtown St. Louis.

To facilitate the search for a buyer, Wehrenberg Theatres hired UBS Investment Bank.

Hoskins said Monday the company did not have a buyer yet, and she declined to give the company's annual revenue or its target sale price.

Moseley, who predicted the buyer would be a big-name cinema group, called Wehrenberg executives "really smart" to look into a potential sale.

"I don't think this is a duress sale," Moseley said, adding that he doesn't plan to sell his own theaters anytime soon. "I think they're selling because they're afraid of the future - the uncertainty of digital, the uncertainty of piracy."

Memo:
Wehrenberg Theatres is shopping for a buyer

Copyright (c) 2007 St. Louis Post-Dispatch
Record Number: 1001150022
St. Louis Post-Dispatch
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Chris Utley
Senior Member

Posts: 631
From: Torrance, CA
Registered: May 2003


 - posted January 07, 2008 08:58 AM      Profile for Chris Utley   Author's Homepage   Email Chris Utley         Edit/Delete Post 
Mark my words, if Regal takes them over, I will never set foot in another (former) Wehrenberg. Period. Mega Screen @ The Galaxy included!

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Christopher Crouch
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Posts: 292
From: Anaheim, CA
Registered: Feb 2006


 - posted January 07, 2008 09:34 AM      Profile for Christopher Crouch   Email Christopher Crouch         Edit/Delete Post 
quote:
Harman Moseley says a "big name theater company" will end up buying Wehrenberg. There are only three that come to my mind: AMC, Regal, and Cinemark. I would favor Regal over AMC, but maybe Cinemark will want to enter the St. Louis market...and what about Starplex?

Starplex wouldn't be my first guess. The company has a pretty full plate right now (ex: five formally announced new builds opening in just the next six months).

I'm not sure any of the "big three" are particularly looking for a significant aquisition right now either. Between their semi recent major mergers/purchases, abundant new builds, and the hefty price tag of digital conversion, one would think they a spread a bit thin financially.

As for non industry investment groups, I think there are too many questions/myths/concerns/public misconceptions about the industry for someone outside the business to step in right now.

I'd guess it would end up being another chain, similar to the recent Pacific Theatres purchase by Reading International.

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Kyle Muldrow
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Posts: 143
From: Laguna Hills, CA
Registered: Jul 2003


 - posted January 07, 2008 11:54 AM      Profile for Kyle Muldrow   Author's Homepage   Email Kyle Muldrow         Edit/Delete Post 
I knew you two would be the first to respond! [Smile]

Chris (Utley), I agree with you about Regal. When I said I favor Regal over AMC, what I should have said was that Regal would be more likely to do this than AMC would. Although they seem to have done a good job with the St. Louis Mills 18, I definitely share your concern about them, especially seeing what they've done to theaters here in Southern California (new builds and takeovers alike). It seems the quality of the show goes down with Regal. Go fig...that's why I was hoping Cinemark might sense an opportunity here. They seem to have better presentation in their SoCal theaters than Regal does.

Chris (Crouch), forgive me for trying to drag Starplex into this...again. Just thought I'd throw it out there. If a non-theater company buys Wehrenberg, does that mean the theaters would still be Wehrenberg Theaters, which would then be a subsidiary of the "parent" company? Isn't that similar to General Cinema in their final days? Weren't they owned by someone else?

For the record, I was back in St. Louis over Christmas and saw "National Treasure: Book of Secrets" at the St. Charles 18. Sound and picture were excellent and they didn't crop the screen. The picture took up the entire screen...and I don't believe this was in one of their main auditoriums. I'm most afraid they would change the name of the Ronnie's or get rid of the drive-in diner if someone else takes over the company. I would hope they wouldn't do that...

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Norman Plant
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Posts: 19
From: St Louis, MO
Registered: Mar 2003


 - posted January 07, 2008 05:08 PM      Profile for Norman Plant   Email Norman Plant         Edit/Delete Post 
Whomever pulls this off has the opportunity to OWN the St Louis area. Regal only has St Louis Mills and AMC has problem properties (Crestwood Plaza). I've got to believe that either company would love to increase their presence in the market. Then someone else could come in and blow both of them away. Wehrenberg is in a great situation. They don't have to sell unless they get their price, and a bidding war could bring them more than they planned on. Kyle, I also hope they keep the indoor Drive In at the Ronnie's. My childhood memories are of the Ronnie's Drive-In and the South Twin Drive-In.

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Christopher Crouch
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From: Anaheim, CA
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 - posted January 08, 2008 02:05 AM      Profile for Christopher Crouch   Email Christopher Crouch         Edit/Delete Post 
quote:
Chris (Crouch), forgive me for trying to drag Starplex into this...again. Just thought I'd throw it out there. If a non-theater company buys Wehrenberg, does that mean the theaters would still be Wehrenberg Theaters, which would then be a subsidiary of the "parent" company? Isn't that similar to General Cinema in their final days? Weren't they owned by someone else?

Nothing wrong with considering them. For all know, they are one of the candidates (I just think it's unlikely).

If a non theatre industry company were to make the purchase, the brand name utilized would depend on a lot of factors. On one hand, changing the branding would be expensive and the Wehrenberg name holds a value/drawing power; thus, supporting continuation of the status quo. On the other hand, the purchasing party might want to create a new brand/image or the seller might not want to part with the name/ask too high a price to include the name. However, I'd speculate the theatres would continue under the Wehrenberg name, as a subsidiary of comany X.

My guess remains a non "big three" chain stepping in. Whether they retain the name or not depends on that particular chain's corporate philosophy.

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Kyle Muldrow
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From: Laguna Hills, CA
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 - posted January 08, 2008 02:15 PM      Profile for Kyle Muldrow   Author's Homepage   Email Kyle Muldrow         Edit/Delete Post 
When you say non-big-three chains, which chains specifically do you mean? I'm sure I've heard names of them before, but none spring to mind right now...

Norm, thanks for backing me up on the Ronnie's. Although I never made it to either of those drive-ins, I'm glad they built the drive-in diner to at least keep the spirit of the place alive.

I'm also surprised Wehrenberg announced the want to sell now when they are going to open two new theaters this year (Gravois Bluffs and Bloomington, IL) and just came out with that book (which I bought) telling about their history and how great it is that the fourth generation is involved in the company. Strange timing, I think.

I know change is unavoidable, but it would really feel like a loss if there was no more Wehrenberg in St. Louis. Does anyone else feel that way?

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David Au
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From: Walnut Creek, CA
Registered: Sep 2006


 - posted January 08, 2008 05:30 PM      Profile for David Au   Email David Au         Edit/Delete Post 
There are many small theater chains such as Classic Cinemas, Muvico, Warren Theatres, Rave Motion Pictures, Phoenix Theatres, Bow Tie Cinemas, Reading Cinemas. However, most of the chains probably could not afford to pay as much as the giant chains such as AMC, Regal, or Cinemark. Most of those small chains usually stick to theaters in only a few states. However, Kerasotes recently ventured out and bought chains in far away states i.e. (Colorado Cinemas).

Of these chains Warren Theatres is well known for amazingly beautiful movie theaters like palaces. They have curtains on their screens, THX, and real butter on their popcorn. However, they seem to focus only on building new theaters. Classic Cinemas doesn't venture out very far, but they have preserved many beautiful classic theaters and restored them. Their website features photos and histories of each theater.

If Cinemark bought Wehrenberg they would probably keep the name just like they kept the Century Theatres name. AMC would probably just add AMC in front of the Wehrenberg name. So the Wehrenberg name would continue on if those two companies were to purchase Wehrenberg.

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Dan Roben
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From: Seattle, WA
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 - posted January 08, 2008 11:30 PM      Profile for Dan Roben           Edit/Delete Post 
As did Regal when they purchased UA and Edwards.

Another chain that might show interest is Malco, headquartered just down the Mississippi River from St Louis in Memphis, Tenn. I have no idea what their operations are like, though.

Wallace Theaters also comes to mind, but I wouldn't wish that evil company on anyone, given the shabby presentations I've unfortunately had to sit through.

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Chris Utley
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From: Torrance, CA
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 - posted January 09, 2008 08:17 AM      Profile for Chris Utley   Author's Homepage   Email Chris Utley         Edit/Delete Post 
quote:
AMC would probably just add AMC in front of the Wehrenberg name.
No they won't. Ask us old St. Louis folks what AMC did to the Mid America name when they took over those theatres in the mid-80's.

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Kyle Muldrow
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Posts: 143
From: Laguna Hills, CA
Registered: Jul 2003


 - posted January 09, 2008 08:44 AM      Profile for Kyle Muldrow   Author's Homepage   Email Kyle Muldrow         Edit/Delete Post 
I'm afraid Chris is right about AMC...when they took over Mid-America Theaters, which was actually RKO-MidAmerica at that time, Mid-America was gone forever. Same thing happened when AMC took over GCC. For that matter, Wehrenberg didn't keep the GCC name when they took over those theaters in St. Louis.

Right now, if a big company takes over Wehrenberg, I hope it's Cinemark. But maybe one of the smaller companies that Chris Crouch or David mentioned could do it...except Wallace, of course. They briefly ran the Union Station 10 before it closed and that totally didn't work out...although that might have more to do with the location than Wallace, but I doubt they want to get back into the St. Louis market.

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The Evil Sam Graham
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 - posted January 10, 2008 10:58 PM      Profile for The Evil Sam Graham   Author's Homepage   Email The Evil Sam Graham         Edit/Delete Post 
If AMC bought Wehrenberg, they would all but own the St Louis market, wouldn't they?

Cinemark, on the other hand, would get one hundred percent new markets out of the deal. Regal practically would too, save for that one St Louis plex of theirs.

Wallace (who have apparently dropped the "Wallace" name in favor of the Hollywood banner) wouldn't make sense to me. They seem to have committed their business model to smaller markets.

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Jerrod Rout
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From: Orange City, FL
Registered: Jan 2008


 - posted January 24, 2008 12:54 AM      Profile for Jerrod Rout   Email Jerrod Rout         Edit/Delete Post 
Well, looks like Regal is probably out since they're buying Consolidated already. I don't see Cinemark buying them but if they did they'd have to do something with the guest services counters behind box office (Cinemark does not believe in having a guest services station, "managers should be on the floor anyway"). As for AMC I really don't think so either. Regal will keep a place open if it makes a dollar but I've seen AMC let go of some potentially decent facilities. Unless they're all state-of-the-art 16+ plexes than probably not. It would have to be someone smaller. Dickinson is in nearby Kansas but they're probably a little too small.

As for the name change. Philip Anschutz first bought UA then he bought Regal Cinemas then Edwards. I'm guessing since Regal Cinemas was by far the largest he let them all operate under the "Regal Entertainment Group" umbrella and put Michael Campbell in charge and Gregory Dunn from UA second in command. REG then swallowed up smaller companies like Eastern Federal, Signature and Hoyts and just stuck REG monikers on the fronts of the buildings. When Regal Cinemas bought Cobb they changed them to Regals but then Cobb opened back up and continued using the name so maybe that has something to do with it too.

Oh, and didn't AMC keep use of the "Magic Theatres" logos when they bought all the Magic Johnson Theatres? Well, technically when AMC merged with loews who merged with sony entertainment who had a partnership with johnson development. [Uh-oh] I think I'm going nuts. . .

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Scott D. Neff
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 - posted January 24, 2008 11:27 AM      Profile for Scott D. Neff   Email Scott D. Neff         Edit/Delete Post 
Cinemark is keeping all the guest service counters at Century. Not that they're required to be manned at all times, but still, they're there.

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Jerrod Rout
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From: Orange City, FL
Registered: Jan 2008


 - posted January 28, 2008 01:59 PM      Profile for Jerrod Rout   Email Jerrod Rout         Edit/Delete Post 
You're right! I never knew Century theatres had guest services until I looked at one today. In any case I think a smaller theatre chain is going to buy them. Cinemark is projected to build 29 theatres alone this year! They'd be huge. er.

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