Moscow's City Hall Privatizes 39 Movie Theaters
Finding buyers willing to continue to use them for showing films took a year
The Moscow city government has sold 39 movie theaters for $182 million (9.6 billion rubles) as part of an ongoing privatization scheme. The buyer, Edisonenergo, pledged a $760 million (40 billion ruble) investment in the renovation of the theaters.
City Hall first announced its plans to privatize all of the 78 movie theaters that it owns a year ago, but prospective buyers were mostly deterred by a condition under which the theaters needed to be renovated and had to continue to operate as cultural institutions after renovation.
Edisonenergo paid the privatization auction's starting price, while about one half of the theaters slated for privatization still await their buyers. The company didn't specify its plans regarding the theaters it just bought but promised to keep screening movies at each of them.
Meanwhile, Edisonenergo is likely to face an expensive endeavor in renovating the theaters, all of which were built in the Soviet era and are mostly located in Moscow's suburbs.
Currently, of the 39 theaters, 18 are completely closed, nine are used for purposes not related to film exhibition, and the remaining 12 need renovation.
Another challenge for the new owner is that most of the theaters are intended for only one or two screens, while Moscow's movie exhibition market is dominated by contemporary multiplex theaters run by large cinema chains.