Marwit Capital Acquires the Movie Theatre Division of Trans-Lux Corporation
Newport Beach, CA – August 14, 2008 – Marwit Capital Partners II, L.P. (“Marwit”) announced today that it completed its acquisition of the entertainment division of Trans-Lux Corporation (AMEX: TLX) for $24.5 million plus potential earn out compensation of up to $2.3 million based on the performance of a recently completed expansion project in Espanola, NM. The acquisition was consummated by Storyteller Theatres Corporation (www.storytellertheatres.com), an entity established by Marwit to focus on the acquisition and development of movie theatres located in secondary and tertiary markets The Company’s theatre circuit currently operates 10 theatres with 69 screens in New Mexico, Colorado, Arizona and Wyoming. Marwit partnered with existing management, Tom Brandt, Matt Brandt and Tom Becker, who will continue to lead the Company going forward.
Chris Britt, Managing Partner at Marwit Capital stated, “Trans-Lux Theatres has a storied history that dates back to the 1920’s and the Brandt family has been involved with the circuit for more than 50 years. In our previous fund, we were fortunate enough to be the first professional investor in Signature Theatres, which grew over a seven-year period to become the 12th largest movie theatre chain in the U.S. before being acquired by Regal Entertainment Group. Storyteller is an excellent platform to apply this experience largely because Trans-Lux, like Signature, has a growth strategy that is focused on small and mid-sized markets.”
Through August 11, 2008, total year-to-date domestic box office receipts were $6.3 billion, roughly equal to the same period for 2007, the industry’s best year ever, and an increase of 7.2%, 14.2% and 3.7% for the same periods in 2006, 2005 and 2004. Theatrical exhibition is still the primary distribution channel for new motion picture releases, and remains the key driver of “downstream” revenues such as DVD/Blu-Ray Disc sales, video-on-demand, and syndicated television. Despite historical economic and industry cycles, the theatre industry has demonstrated long-term steady growth over 40 years in both revenue and attendance. Going to the movies continues to be the one of the most affordable outings for families, and draws more than twice the attendance of theme parks and major sports combined.
Matt Brandt, co-CEO stated, “Our theatre circuit has a long history of providing a quality entertainment experience to our patrons by delivering Hollywood's latest and greatest films in the comfort and style of what today's discerning movie-goer has come to expect”. Tom Brandt, co-CEO added, “By partnering with Marwit, the Company is in a strong position to grow the business by expanding our existing theatres, developing new cinemas in adjacent or contiguous markets and acquiring additional theatres to expand our geographic footprint.”
About Theatre Division of Trans-Lux, dba Storyteller Theatres Corporation
Storyteller, formerly Trans-Lux Theatres (www.storytellertheatres.com), is based in Santa Fe, NM and operates 10 theatres comprising 69 screens in New Mexico, Colorado, Arizona, and Wyoming. The Company’s theatres are located in secondary and tertiary markets where the current population is under 100,000 but rapidly growing. Trans-Lux Theatres was divested from Trans-Lux Corporation (TLX), the oldest listed company on the American Stock Exchange.
About Marwit Capital
Marwit Capital (www.marwit.com) is one of the oldest and most experienced private equity firms in the western U.S. Founded in 1962, Marwit’s investment focus is on lower middle market companies based in the Western U.S., with revenues of $20 to $200 million and enterprise values generally up to $100 million. Marwit specializes in management buyouts, platform LBO acquisitions in partnership with experienced industry executives, recapitalizations, and later stage growth investments. Marwit generally invests $10 to $30 million of equity capital per portfolio company, and is currently investing out of Marwit Capital Partners II, a $183.7 million fund that held its final closing in August 2007.
Vice President Finance and Investor Relations