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Alliance faces financial woes
Monday October 20th 2008Alliance Films, Canada’s largest film distributor, continues to face financial woes. Its owners, Goldman Sachs and Quebec government investment arm Societe Generale de Financement, had to step in this past August to invest an added C$40 million ($34 million) to shore up the company and allow it to meet its financial obligations. This investment was revealed in a note released by Moody’s Investors Service on Thursday.
Goldman Sachs kicked in $21 million and Societe General de Financement provided the remaining $13 million. Goldman Sachs owns 61.5% of Alliance, with the rest owned by the Quebec government investment agency.
In addition, Moody’s has downgraded its credit rating for the Montreal-based film company from Caa1 to Caa2, reflecting the company’s “high leverage, weak liquidity and risk associated with film quality and contract renewal.”
“Goldman Sachs demonstrated its full confidence in the management of the company and it’s putting us in a strong position to raise film financing in a period where a lot of people are not able to finance films,” said Alliance Films president Charles Layton.
It has been a rocky year for Alliance Films. It was bought in January by Goldman Sachs and the Societe Generale de Financement, and, just weeks later, Alliance lost two of its most important suppliers, with the departure of New Line and Miramax Films. Last month, Alliance announced that New Line parent Warner Bros. had changed its mind and that Alliance would be allowed to keep distributing New Line pics in Canada through to the fall of 2009.
At the same time, Alliance announced that it had inked output deals with three new suppliers: Relativity Media, Grosvenor Park and Freestyle Releasing. And box office returns in Canada have picked up in 2008 for Alliance after a very bad 2007, thanks to hits like “Sex and the City” and “Journey to the Center of the Earth.” But Alliance also faces more serious competition than ever before, with the beefing up of rival distrib Entertainment One, and its subsidiary Seville Pictures, and Maple Pictures’ expansion now that it has the contract with Miramax for Canada.
A spokesman for the Societe General de Financement said the agency is still upbeat about Alliance’s future.
“We’re keeping our faith in that investment in spite of the bumps in the road,” said the spokesman. “We still believe that Alliance could have a bright future.”
Source: Variety
Headline, Industry News
Alliance faces financial woes
Monday October 20th 2008Alliance Films, Canada’s largest film distributor, continues to face financial woes. Its owners, Goldman Sachs and Quebec government investment arm Societe Generale de Financement, had to step in this past August to invest an added C$40 million ($34 million) to shore up the company and allow it to meet its financial obligations. This investment was revealed in a note released by Moody’s Investors Service on Thursday.
Goldman Sachs kicked in $21 million and Societe General de Financement provided the remaining $13 million. Goldman Sachs owns 61.5% of Alliance, with the rest owned by the Quebec government investment agency.
In addition, Moody’s has downgraded its credit rating for the Montreal-based film company from Caa1 to Caa2, reflecting the company’s “high leverage, weak liquidity and risk associated with film quality and contract renewal.”
“Goldman Sachs demonstrated its full confidence in the management of the company and it’s putting us in a strong position to raise film financing in a period where a lot of people are not able to finance films,” said Alliance Films president Charles Layton.
It has been a rocky year for Alliance Films. It was bought in January by Goldman Sachs and the Societe Generale de Financement, and, just weeks later, Alliance lost two of its most important suppliers, with the departure of New Line and Miramax Films. Last month, Alliance announced that New Line parent Warner Bros. had changed its mind and that Alliance would be allowed to keep distributing New Line pics in Canada through to the fall of 2009.
At the same time, Alliance announced that it had inked output deals with three new suppliers: Relativity Media, Grosvenor Park and Freestyle Releasing. And box office returns in Canada have picked up in 2008 for Alliance after a very bad 2007, thanks to hits like “Sex and the City” and “Journey to the Center of the Earth.” But Alliance also faces more serious competition than ever before, with the beefing up of rival distrib Entertainment One, and its subsidiary Seville Pictures, and Maple Pictures’ expansion now that it has the contract with Miramax for Canada.
A spokesman for the Societe General de Financement said the agency is still upbeat about Alliance’s future.
“We’re keeping our faith in that investment in spite of the bumps in the road,” said the spokesman. “We still believe that Alliance could have a bright future.”
Source: Variety
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Headline, Industry News
Alliance faces financial woes
Monday October 20th 2008Alliance Films, Canada’s largest film distributor, continues to face financial woes. Its owners, Goldman Sachs and Quebec government investment arm Societe Generale de Financement, had to step in this past August to invest an added C$40 million ($34 million) to shore up the company and allow it to meet its financial obligations. This investment was revealed in a note released by Moody’s Investors Service on Thursday.
Goldman Sachs kicked in $21 million and Societe General de Financement provided the remaining $13 million. Goldman Sachs owns 61.5% of Alliance, with the rest owned by the Quebec government investment agency.
In addition, Moody’s has downgraded its credit rating for the Montreal-based film company from Caa1 to Caa2, reflecting the company’s “high leverage, weak liquidity and risk associated with film quality and contract renewal.”
“Goldman Sachs demonstrated its full confidence in the management of the company and it’s putting us in a strong position to raise film financing in a period where a lot of people are not able to finance films,” said Alliance Films president Charles Layton.
It has been a rocky year for Alliance Films. It was bought in January by Goldman Sachs and the Societe Generale de Financement, and, just weeks later, Alliance lost two of its most important suppliers, with the departure of New Line and Miramax Films. Last month, Alliance announced that New Line parent Warner Bros. had changed its mind and that Alliance would be allowed to keep distributing New Line pics in Canada through to the fall of 2009.
At the same time, Alliance announced that it had inked output deals with three new suppliers: Relativity Media, Grosvenor Park and Freestyle Releasing. And box office returns in Canada have picked up in 2008 for Alliance after a very bad 2007, thanks to hits like “Sex and the City” and “Journey to the Center of the Earth.” But Alliance also faces more serious competition than ever before, with the beefing up of rival distrib Entertainment One, and its subsidiary Seville Pictures, and Maple Pictures’ expansion now that it has the contract with Miramax for Canada.
A spokesman for the Societe General de Financement said the agency is still upbeat about Alliance’s future.
“We’re keeping our faith in that investment in spite of the bumps in the road,” said the spokesman. “We still believe that Alliance could have a bright future.”
Source: Variety
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