Independent Film Producer Buys Two Theater Chains

Heritage Entertainment, an independent Los Angeles production company, said Thursday that it is getting into the movie theater business with the purchase of two chains, Landmark Theatre Corp., owner of the Nuart in West Los Angeles, and Seven Gables Theatres.

Skip Steloff, chairman and chief executive of Heritage, said the acquisition of the 39-screen Landmark Theatres and 34-screen Seven Gables Theatres makes the Los Angeles company the first of the smaller independent production houses to have its own outlet of theaters.

Cannon Group, a larger independent, bought the Commonwealth Theater chain in 1986, the year major studios began a wave of buying theaters in a consolidation move.

“I’m really excited because I see us as the first independent company of our size . . . now so totally integrated so that when we make a picture at one end or acquire it for distribution, assuming our theaters want them, we have very good built-in relief outlets,” explained Steloff. “It is the first time an independent can do that. We can attract a lot of young terrific directors.”

He said Heritage-- whose recent production credits include “Mr. North,” directed by Danny Huston, who had some help from his father, John Huston, before his death, is buying the two chains for stock and cash, but he declined to give the value of the deal. He expects to have a 100-screen chain by the end of the year.

The acquisition gives Heritage entry into 15 key markets. However, it will lack a presence in the East, notably New York, Washington, D.C., and Philadelphia.

Landmark, which began with the Nuart in 1974, is based in Los Angeles and shows high-quality specialty and foreign films in California, Colorado, Minnesota, Louisiana, Missouri, Texas, Washington and Wisconsin. Its management, including Stephen A. Gilula, president and chief executive, will continue in their present positions.

Gary Meyer, executive vice president of Landmark, said the chain has been working on an expansion and renovation plan but lacked the financial means to put it in place. The Heritage deal will enable the chain to grow, he said.

Seven Gables, which is based in Seattle, operates its 34 screens in 11 locations in Seattle and Portland. They play both commercial and specialized films.