DJ MoviePass Insider Makes Offer for Subscription Service--Update
By Jonathan Randles
The man behind MoviePass's parent is angling to revive the theater-subscription service, days after its suspension.
Theodore Farnsworth, chairman and chief executive of MoviePass's majority shareholder Helios & Matheson Analytics Inc., is leading a group of investors on an offer to purchase the company's assets, a spokesman for Mr. Farnsworth said.
On Sunday, Mr. Farnsworth stepped down as chief executive of Helios in connection with his consortium's offer for the assets of the public data-analytics company. The offer is for MoviePass, the company's other brands including the movie-time-listing service Movifone and a film-acquisition business called MoviePass Films, according to Mr. Farnsworth's resignation letter, a copy of which was reviewed by The Wall Street Journal.
Helios could receive competing offers for MoviePass and the rest of the company's assets, Mr. Farnsworth's spokesman said. MoviePass's parent on Friday said it was exploring all its options, including a potential sale of all its assets and said it "is unable to predict if or when MoviePass service will continue."
Mr. Farnsworth's proposal represents the latest twist in MoviePass's tumultuous run which culminated last week when the theater-subscription service said it was again being shut down because the company had failed to recapitalize the business.
MoviePass launched in 2017, letting subscribers watch a movie a day for a monthly fee of $9.99. The offer to let people watch many movies for little money attracted more than 3 million subscribers but the low price quickly proved unsustainable because the company reimbursed movie theaters the full ticket price.
Helios hoped to make up the difference in price by selling user data. The company raised subscription prices, took on expensive short-term debt and reduced the number of movies users could see each month. But that didn't work.
In a message to subscribers posted on its website, MoviePass CEO Mitch Lowe wrote "we hope to find a path that will enable us to continue the service in the future."
Ethan Millman and R.T. Watson contributed to this article
Write to Jonathan Randles at Jonathan.Randles@wsj.com
(END) Dow Jones Newswires
September 17, 2019 12:03 ET (16:03 GMT)
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