Wehrenberg emerging from Chapter 11

In a comeback reminiscent of big-screen drama, Wehrenberg Inc., owner of Springfield's Campbell 16 Cin, is emerging from bankruptcy, paying off its creditors and predicting a bright future.

The turnaround

"We are really one of the only circuits that went into Chapter 11 that has since emerged with the same management team and ownership group in place," said Wehrenberg Inc. president Ron Krueger II, in a phone interview from St. Louis.

The company recently an-nounced that it is emerging from its 10-month reorganization plan and has paid in full all creditors owed less than $10,000. Krueger said those owed more than $10,000 received initial payments of 70 percent of what is owed, with the remaining payments spread out over the next four quarters. The first quarter payment has been made, he said, but he declined to say how much still is owed.

Krueger said Wehrenberg's reorganization strategy was handled the old fashioned way the way the family owned chain has operated since 1906. Krueger serves as co-chairman with his father, Chief Executive Officer Ronald P. Krueger.

It was the elder Krueger's grandfather, Fred Wehrenberg, who founded the company.

"When we went into the Chapter 11, we communicated with the folks we owed money to. ... Our pledge and promise to them was that we would make a 100 percent repayment of the monies owed to them," he said.

The creditors still receiving payments are getting 8 percent interest on their money, he added.

"We used the Chapter 11 process the way it should be used," he said.

The film breaks

When St. Louis-based Wehrenberg Inc. filed for Chapter 11 bankruptcy in January 2001, the fate of the industry itself seemed to be in doubt.

Wehrenberg was among 10 theater chains, comprising nearly half of the nation's movie screens, that filed for bankruptcy between 1999 and 2001, in-cluding industry leader Regal Cinemas, as well as Loew's Cineplex, General Cinemas and United Artists.

Many theater chains are consolidating to stay afloat.

Kansas City-based AMC Entertain-ment proposed a $167 million buyout of General Cinemas that is pending court approval, and Regal's new owner, billionaire investor Philip Anschutz, is expected to acquire United Artists Theaters and Edwards Theater Circuit.

Wehrenberg, however, remains an independent regional chain, Krueger said.

The show goes on

Part of Wehrenberg's strategy was to close eight underperforming theaters: the Battlefield Mall's Cine 6, three in Arizona and four in metro St. Louis.

That seems to have been the answer for many struggling chains. According to the National Association of Theatre Owners, the nation's total screen count decreased by about 1,700 from 1999 to 2001, or almost 600 screen closings per year.

Krueger said closings were driven by guests' "overall demand for a state-of-the-art movie-going complex, like the Campbell is in Springfield."

He said the locations that didn't provide the new services and amenities, such as stadium seating, digital sound and larger screens, couldn't draw the necessary crowds to support the operations.

In 1999 Wehrenberg ensured Campbell 16's future success by adding such amenities, and Krueger said now it is one of the chain's top-performing theaters.

"We have a great management team down there lead by Denny Goins," Krueger said.

Goins, who has been managing director since it opened in 1996, said last season was anchored by "Harry Potter" and "Monster's Inc.," but "Lord of the Rings' has been our biggest draw."

The sequel

"We're happy where we stand right now," Krueger said. "We take a whole lot of pride and affinity to that legacy that exists and we weren't going to let it go. We just had to take a business time out. We're back on track."

Wehrenberg now operates 16 locations and 196 screens in Missouri and Illinois.

Once all creditors are paid in full Krueger said the company will begin "looking for under-served markets that we feel need a good Wehrenberg Theater experience. We will be expanding," he said. The chain's Web site is www. wehrenberg.com.