Germany's Kinowelt Medien has sold close to one million shares of Alliance Atlantis Communication (AAC) worth approximately $13m, part of which it will funnel into Momentum Pictures, the UK distribution company it controls equally with AAC.
Paul Laberge, AAC senior vice president of corporate development and general counsel, told ScreenDaily the move would allow Kinowelt to meet its financial obligation to Momentum. The partners are committed to investing $25m per year for three years; Kinowelt's share for this year is $12.5m.
Kinowelt, which like other German entertainment companies has seen its share price plummet on the Frankfurt Neuer Markt, is capitalising on a recent rise in AAC's stock price. As well, the Canadian dollar is fairing better against the US dollar than the Euro.
Kinowelt offloaded 926,000 Class B non-voting shares but said it intends to keep its equity stake in Alliance above 20%. AAC stock has risen in recent weeks, spurred by a spate of Canadian media mergers that has lifted the share price of several content providers. AAC stock was down C$2.50 Oct. 25, closing at C$22 (US$14.51).
Momentum, which has an output deal with Artisan and a multi-picture deal with StudioCanal, is one of a group of international distributors taking an equity position in the Steve Tisch-led production outfit Escape Artists.
Meanwhile, AAC has announced a new five-year, $330m revolving line of credit through a syndicate of Canadian banks. The company said the credit facility will be used to refinance its senior debt and fund acquisitions, internal growth initiatives and for general corporate purposes.