Village Roadshow Entertainment Group (VREG) has filed for Chapter 11 bankruptcy protection in the US, citing an ongoing legal dispute with Warner Bros. and expenses related to creating independent content as major contributors to its financial decline.
The company, known for producing The Matrix trilogy and Joker, has approximately US$223.8 million in asset-backed secured loans and US$163.1 million of senior secured debt, according to documents filed in the US state of Delaware on Monday US time.
VREG is separate from the Australian-based Village Roadshow Group which was formed in 1954 and includes Village Roadshow Theme Parks, Roadshow Distributors, Roadshow Productions, Village Roadshow Studios, and Village Cinemas. Since 2017, the Village Roadshow Group has had no strategic, operational control, management oversight, or financial responsibility for VREG.
Village Roadshow Group CEO Clark Kirby said the company was not impacted by VREG’s financial issues.
“As former owners of VREG, we are extremely disappointed to read in the press that VREG has filed for Chapter 11, Bankruptcy in the USA and I have immediately sent notice to terminate VREG’s use of the Village Roadshow name,” he said.
“During Village Roadshow Group’s ownership, VREG had been a successful business producing legacy films.”
The court document noted that VREG’s primary assets are contractual rights and intellectual property, including interests in 108 feature films, intellectual property, distribution rights, and cash flows (collectively, the “Library Assets”), which generate approximately US$50 million per year.
It also has “co-ownership” agreements with WB related to the exploitation of derivative rights (e.g., prequels and sequels) attached to films in the Library Assets.
The WB relationship was at the centre of a legal complaint the company filed in early 2022 following the release of The Matrix Resurrections on HBO Max on the same day it premiered in theatres, a move that Village Roadshow claimed was in breach of contract concerning derivative rights.
As per the court documents, the ongoing arbitration has caused VREG to” incur more than US $18 million in legal fees “nearly all of which remain unpaid and presents the threat of a potential arbitration award that could flatten the Company’s balance sheet, but that is not the full extent of its impact”.
Also detrimental to the company, as outlined in the filing, was the expansion of its business model into creating content – including films, scripted television series, and unscripted television programs – independent of studio partners. Between 2018 and 2020, the business spent approximately US$47.5 million on “development expenses for projects that either were developed and never produced or if produced, never became profitable”.
Compounding the situation was what the company described as a “confluence of macro-economic factors” across the past few years, including the COVID pandemic disruption, delays to production resulting from the 2023 writers’ and actors’ strikes, and the “streaming wars” and alternate viewing methods that challenged business models “across the board”.
Due to cost-cutting measures, VREG’s staff has decreased from 45 employees in the US and Melbourne at the beginning of 2024 to just two executives and three at-will administrative professionals in the US and six financial professionals in Australia as of March 2025.