DEADLINE PARIS: The French pay-TV giant today unveiled a slate financing deal worth €150 million ($203.9 million) over the next three years. The money will cover 30% of the budgets of all Studiocanal’s international productions. This means that Studiocanal will now be spending €200 million a year on movie production. London-based finance house Anton Capital Entertainment (ACE) has raised the money through a mixture of U.S banks and undisclosed European financial institutions. Union Bank and Bank of America are among the U.S. lenders involved in the deal. Today’s announcement is intended to establish Studiocanal’s spot as the first port of call outside the U.S. for intelligent upmarket movies like Tinker Tailor Soldier Spy which is fully financed. Olivier Courson, chairman/CEO of Studiocanal, says it is the first time a European mini-major has used the kind of slate funding which got Wall Street into such trouble five years ago. Some U.S. investors lost their shirts throwing millions of dollars at Hollywood.
Asked how he would reassure investors burnt by previous Hollywood slate fund deals, Courson said the difference this time around is that Studiocanal is producing a much more diversified slate and not just a handful of blockbusters. Courson says most Hollywood studios have operating profits of less than 10%, partly because of the ballooning cost of production, “crazy” marketing spends, and limited slates aimed at teenagers. Studiocanal, on the other hand, is on track to make a 14% profit this year on sales from a diversified slate of E400 million. “The deal means we will be able to increase our investment capacity, and we don’t have to find partners for each new film. To date we have not had to borrow money to fund our films,” says Courson.
Courson says Studiocanal is interested in financing the next Black Swan or The Social Network: “the kind of films which the studios have largely abandoned”. Paris-based Studiocanal is already riding high on the UK success of Tinker, Tailor, Soldier, Spy. Courson also wants to make more animated family films, and upmarket genre films such as the just-announced The Last Exorcism 2.
Sebastian Raybaud, managing director of ACE, says that revenue coming in will be split from first dollar, rather than having his investors’ pushed to the back of the queue when it comes to getting their money back – as was the case with some early Hollywood slate deals. “The alignment of interests is much better than in some of the deals you have seen,” says Raybaud.
However, the question remains whether injecting €150 million into a hundred different movies will work any better than putting the same amount of cash into a handful of Hollywood’s sure-thing blockbusters. It previously financed Unknown, starring Liam Neeson, and the Simon Pegg/Nick Frost comedy Paul. Future production includes the next Coen Brothers’ filmInside Llewyn Davis, produced by Scott Rudin and shooting in New York this fall, plus The Last Photograph, starring Sean Penn and Christian Bale, which is the next film from Zack Snyder (Man Of Steel) and producer Joel Silver. The company releases its own movies in three key European territories – France, Germany and the UK – which between them represent 80% of the European market.
Studiocanal also owns a vast back catalogue that, Courson explains, is ripe for plundering. Paramount remade Studiocanal’s original of The Tourist (Anthony Zimmer), while Studiocanal itself remade Brighton Rock, and is developing another Graham Greene remake, The Fallen Idol, with U.S. producer Walter Parkes. Peter Jackson is developing a remake of classic British Second World War movie The Dambusters.
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