Theater pioneer folds under amassed debt

Dansungsa, Korea’s first movie theater, is shown in this file photo when it screened the local hit “The General’s Son” in 1990. The theater in Jongno, central Seoul, yesterday filed for bankruptcy. [JoongAng Ilbo]

Dansungsa, the company that founded Korea’s first movie theater, went bankrupt yesterday.

But the cinema will operate normally for at least two years as Dansungsa, which owns the building where the theater is located, signed a contract with Cinus, a theater chain, for that period.

Woori Bank yesterday said Dansungsa bounced 1.5 billion won ($1.3 million) worth of checks on Tuesday.

According to industry sources, Dansungsa has faced mounting losses lately.

The company posted 11 billion won in losses last year and it’s had negative assets for the past two years. Its sales last year stood at 4.4 billion, down 3.4 billion won from a year earlier.

Woori Bank, which manages Dansungsa’s debt, said the company, in a last-ditch effort, tried to sell the cinema building in central Seoul but the slowdown in the real estate market hindered the plan.

The building in Jongno also accommodates other shops, such as jewelry stores.

Dansungsa was established in 1907 and ran the first Korean-made movie, “Fight for Justice,” on Oct. 27, 1919.

That date, designated in 1962 as “Korean Movie Day,” has been celebrated annually since.

Kim Byung-kwon, a manager with Cinus-Dansungsa, the movie theater, said the bankruptcy will not affect management of the cinema because Cinus has rented the spot.

Cinus signed the two-year rental contract with Dansungsa in May.

“We can run the cinema for at least the two-year contract period as stipulated by the law of lease protection,” he said.

Cinus operates 27 cinemas across the nation. Cinus-Dansungsa, a multiplex, has 10 theaters and a combined 1,802 seats.

By Seo Ji-eun Staff Reporter [spring@joongang.co.kr]