Milwaukee-based Marcus Theatres expands into the South with $126 million Movie Tavern buy

Milwaukee-based Marcus Theatres is expanding into the South, and boosting its number of cinema screens by nearly 25 percent, with a new $126 million acquisition.

Marcus Theatres, a division of Marcus Corp., has agreed to buy the assets of Movie Tavern from VSS-Southern Theatres LLC, the company announced Friday.

With 22 locations and 208 screens in nine states, New Orleans-based Movie Tavern is  known for its in-theater dining and luxury seats, according to Marcus.

Those are both areas where Marcus Theatres has been investing, with the theater circuit's in-house Zaffiro's restaurants, DreamLounger reclining seats and new BistroPlex restaurant/cinema complexes. 

With the Movie Tavern purchase, Marcus Theatres will own or operate 1,098 screens at 90 locations in 17 states.

That represents a 23 percent increase in the circuit's total screen count.

It also brings Marcus Theatres, which operates throughout the Midwest and Mid-Atlantic regions, into nine states where it has no cinemas.

The acquisition of Movie Tavern is a milestone in the growth of Marcus Theatres, said Gregory S. Marcus, president and chief executive officer of Marcus Corp.

The purchase is expected to close in the first quarter of 2019, and add to the company's earnings and cash flow within the first 12 months, Marcus said.

In-theater dining options are a big part of the theater circuit's growth, said Rolando B. Rodriguez, chairman, president and chief executive officer of Marcus Theatres.

“Building upon this successful platform, we look forward to collaborating with our new colleagues to further enhance the Movie Tavern experience," he said in a statement.

The first Movie Tavern location opened in 2001.

Owned by VSS-Southern Theatres since 2013, Movie Tavern operates in Arkansas, Colorado, Georgia, Kentucky, Louisiana, New York, Pennsylvania, Texas and Virginia.

Marcus Theatres will retain the Movie Tavern brand name.

VSS-Southern Theatres is a portfolio company of Veronis Suhler Stevenson, a private equity firm.

Based upon Thursday’s closing share price of Marcus Corp.’s common stock, the purchase price is currently valued at approximately $126 million.

That includes $30 million in cash and 2,450,000 shares of Marcus Corp. common stock, subject to certain lock-up restrictions.

Marcus Theatres is North America's fifth-largest theater circuit, according to the National Association of Theater Owners. AMC Theatres is the largest, with just over 8,200 screens.

Marcus' last big acquisition happened in 2016. The company bought St. Louis-based Wehrenberg Theatres, which operated 14 Midwest cinemas with 197 screens.

Tom Daykin can be emailed at tdaykin@jrn.com and followed on Instagram, Twitter and Facebook.