Luc Besson’s EuropaCorp Confirms Discussions With Vine Alternative Investments – Update

Europa

UPDATED with EuropaCorp statement: Luc Besson’s embattled EuropaCorp has responded to a report in French weekly, Le Journal du Dimanche, which said on Sunday the studio was entering a deal that would see NY-based Vine Alternative Investments come to its rescue. In a statement provided to Deadline, Europa confirmed discussions “with several financial partners including the group Vine, as part of the restructuring of its debt and the strengthening of its financial capacity.”

Vine, Europa said, “has expressed interest in a potential stake in the capital of the company” and talks are ongoing. As of March 31, EuropaCorp’s net debt stood at $181M. In May, the company was granted a six-month debt waiver to give it time to balance the books. Vine would be expected to convert Europa’s debt into capital shares.

A rescue deal between Europa and Vine was reportedly hatched on July 3 in the office of the French judicial administrator. Vine, which bought a controlling interest in Village Roadshow in 2017, and Europa have existing ties under a credit line provided by the former as its junior lender.

In late May, Europa said it was still in talks with other buyers including Pathé which was looking to take a majority stake in the studio as well as potentially providing a cash infusion. The Pathé deal now appears to be off the table.

Europa did not provide any further details of a possible Vine deal which is reliant upon an agreement with senior lenders and the presentation of a safeguard plan to the Commercial Court of Bobigny which had granted the debt waiver.

See the full statement below the original post.

PREVIOUS, 7:04AM PT: Luc Besson’s embattled EuropaCorp has reportedly spurned an acquisition offer from French giant Pathé, turning instead to U.S.-based Vine Alternative Investments. According to French weekly paper Le Journal du Dimanche, a rescue deal between Europa and Vine was hatched on July 3 in the office of the French judicial administrator. Details are scarce and any accord would still need to be validated by the Commercial Court of Bobigny which in May granted Europa a six-month debt waiver to give it time to balance the books. As of March 31, the company’s net debt stood at $181M. Deadline has reached out for comment.

Vine and Europa have existing ties under a credit line provided by the former. A recovery plan has yet to be revealed, although local media has speculated that Vine could convert Europa’s debt into capital shares and that the asset manager would appear sufficiently solid to satisfy lenders.

Vine, which bought a controlling interest in Village Roadshow in 2017, was founded in 2006 and has already committed more than $700M to investments in assets backed by major motion pictures, television and other media and entertainment content. Earlier this year, Vine raised another $600M.

As of late May, EuropaCorp was still in talks with other buyers including Pathé which was looking to take a majority stake in the mini-studio as well as potentially providing a cash infusion. Besson and his holding company FrontLine own 38% of Europa while Chinese investors own 28% after a $67M investment three years ago.

In June, Deadline reported that Steve Rabineau was leaving WME to partner with Luc and Virginie Besson in the theatrical film and TV series business, under their EuropaCorp label. Besson has been a longtime client and friend of Rabineau, and the goal is to generate three films per year, one of which will be directed by Besson.

Besson is an idea machine with a long track-record of critical and/or commercial hits from The Big Blue to The 5th Element, The Professional, La Femme Nikita, Taken and Lucy. But 2017’s Valerian And The City Of A Thousand Planets was a costly misfire. Not helped by misconduct allegations — which Besson denied, and a police investigation dismissed earlier this year — EuropaCorp has been looking for new backing.

In late June, the company posted unflattering results for the 2018-19 financial year, including a loss of $125M, which was a 27% increase year-on-year. The company said net debt stood at $181M as of March 31, a reduction of almost $90M year-on-year, mainly due to the payment of production debts related to Anna, the series Taken and Taxi 5.

While most income came from the delivery of Anna, the film has made just $7.5M domestically since its June 21 release via Lionsgate. It opened this past Wednesday in France, selling 80K tickets on the first day in an inauspicious debut which charted as the 25th best of the year so far.

Since December, Pathé has been distributing EuropaCorp movies with the contract calling for three over the next three years including Anna. No further films are in production at EuropaCorp after Anna.

Full statement from EuropaCorp:

“Following the article published today in Le Journal du Dimanche, the Company confirms, as it did on 29 May 2019, to be in discussions with several financial partners, including the group Vine, as part of the restructuring of its debt and the strengthening of its financial capacity.

As mentioned in this article, Vine has expressed interest in a potential stake in the capital of the Company. Discussions are currently ongoing concerning the terms and conditions of this potential operation and the financing of the Group for the future.

The potential realisation of this operation implies in particular the search of an agreement with the senior lenders and the presentation of a Safeguard Plan to the Commercial Court of Bobigny. Therefore the Group cannot assure that this operation will come to a successful conclusion, nor give any precision on the schedule or structuring of the potential transaction resulting from the current discussions.

The Company will inform the market, in due time, of the outcome of the current negotiations.”

This article was printed from https://deadline.com/2019/07/luc-besson-europacorp-vine-alternative-investments-takeover-pathe-1202646021/