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Amazon is in the running to acquire Landmark Theatres, a move that would vault the e-commerce giant into the brick-and-mortar cinema industry, according to people familiar with the situation.

The company is vying with other suitors to acquire the business from Wagner/Cuban Cos., which is backed by billionaire Mark Cuban and Todd Wagner, according to the people, who asked not to be identified because the discussions are private. The chain’s owners have been working with investment banker Stephens Inc. on a possible sale, the people said. No final decisions have been made, and talks could still fall apart.

Pushing into movie theatres would follow Amazon’s expansion into myriad other forms of media, including a film and TV studio and music service. With Landmark, it gets a chain focused on independent and foreign films with more than 50 theatres in 27 markets, including high-profile locations in New York, Philadelphia, Chicago, Los Angeles and San Francisco.

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Landmark’s theatres are known for art-house fare, and some high-end locations include coffee bars or lounges, setting them apart from the typical movie experience.

“This is probably a move to get broader distribution of film content,” said Leo Kulp, an analyst with RBC Capital Markets LLC. “Netflix had been discussed as a potential buyer of Landmark for a similar reason.”

Amazon and Landmark declined to comment.

The possible move was viewed positively by investors, who saw it as a sign that Amazon wasn’t looking to disrupt moviegoing and was supportive of the theatrical experience, Kulp said. After initially being down, shares of AMC Entertainment Holdings Inc. and Cinemark Holdings Inc. climbed on Thursday. AMC, the market leader, rose as much as 4.2 percent, reaching its highest point in the past year.

Cozying Up

Amazon’s move into Hollywood has broadly been welcomed by theatres and studios. Its studio has presented its slate of movies at CinemaCon, the annual convention for national theatre operators, unlike Netflix Inc. Amazon struck a deal with Sony Pictures where it offered its Prime members the opportunity to see movies like “Jumanji” and “Hotel Transylvania 3” two weeks before release at about 1,000 theatres.

Though the acquisition price for Landmark would likely be small, it would mark a significant new incursion by Seattle-based Amazon into the physical world. The online retailer shocked the supermarket industry last year by acquiring Whole Foods for $13.7 billion, positioning the organic-food chain in the middle of its campaign to sell more groceries.

The e-commerce company already spends billions each year on movies and TV shows, saying it helps entice shoppers to join its Prime subscription plan and makes existing members more likely to renew.

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Amazon, founded as a book seller, previously disrupted that industry by giving authors an alternative to the big publishers, eliminating a middleman between readers and artists. It opened its first physical bookstore in 2015 in Seattle and now has nearly 20 around the country.

Paramount Decree

The U.S. has previously barred film studios from the theatre industry. But the government said earlier this month that it was considering terminating a 70-year-old Hollywood settlement that halted the vertical integration of studios and theatres. The so-called Paramount decree may have prevented smaller films from getting wider distribution.

“It’s very possible that the Paramount decree gets overturned,” said David Miller, an analyst with Imperial Capital LLC. “It will be interesting to see if Amazon could be the first to test the new rules.”

Cuban and Wagner also own Magnolia Pictures, the production company 2929 Productions, and the networks AXS TV and HDNet Movies. Cuban, a 60-year-old who also appears on the reality show “Shark Tank,” told the Hollywood Reporter in April that he hired a bank to evaluate offers, but said at the time he was in “no rush to sell.”

The theatre operators had been under pressure in recent years as the popularity of Netflix and other home streaming services fueled fears that audiences were less willing to go out to movies.

“I’d say this is a sign of good health for the industry,” Miller said.

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– With assistance from Scott Moritz and Caleb Mutua.

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