More foreign money came flooding into Hollywood this week as Canada's Capital Communications CDPQ, a subsidiary of Montreal-based fund management giant Caisse de depot et placement de Quebec, announced that it will make a "major strategic investment" in Mosaic Media Group. Mosaic is the new name for the merged entities of Atlas Entertainment, Gold-Miller Management, Atlas-Third Rail Management and Third Rail Records.
Encompassing film and TV production, talent management, recorded music and new media, Mosaic will act as the platform through which Capital will invest "hundreds of millions of dollars" in the entertainment sector, according to one source close to the deal. Investments will be made not only in Mosaic talent and projects, but also in other ventures such as strategic company and library acquisitions.
Capital Communications CDPQ has been looking for a foothold in the entertainment sector for three years through Montreal business executive Henry Winterstern, who now becomes a board member of Mosaic and Capital's partner and representative. Winterstern and Los Angeles entertainment attorney Joel Behr negotiated the transaction for Capital with Mosaic president Allen Shapiro and Tom Spiegel, Mosaic's business adviser.
Mosaic manages talent such as Jim Carrey, Ellen DeGeneres, the Wayans family and Jay Roach, among many others. Under partner Chuck Roven, it has a film co-financing and distribution agreement with MGM, Helkon Media in Germany and Toho-Towa in Japan that kicks off with John McTiernan's $70m actioner Rollerball, starring Chris Klein and currently shooting in Capital's home town of Montreal. Atlas' credits include City Of Angels, 12 Monkeys and Three Kings, while Gold-Miller produced this summer's blockbuster hit Scary Movie.
A prime example of the synergies within the group, which merged in July 1999, is the City Of Angels soundtrack, which was packaged to include songs by Mosaic clients such as Alanis Morrissette and The Goo Goo Dolls. Those songs went on to top the charts, while the soundtrack sold eight million copies and won three Grammies. The group's new media division, Tidal4, has also placed DeGeneres' and Morrissette's recent tours onto popular entertainment website Z.com.
Since it was created in 1995, Capital has invested in 78 companies in Quebec, Canada, and world markets to the tune of about $2.7bn (C$4bn). The company has partnerships with firms in telecommunications, media, entertainment, software and equipment. Caisse de depot et placement de Quebec has assets totalling more than $71.1bn and offers a complete range of fund management services worldwide.
The Mosaic deal confirms the new model for Hollywood financing - investing directly in creative and producing talent rather than in the studio system itself.