Andres Vicente Gomez, head of Spain's leading production outfit Lolafilms, is in talks with Germany's Helkon Media to swap 5% company stakes and forge a co-production relationship.

Gomez said the proposed move forms a part of his new strategy for 2000 to transform Lola into a major European company.

"This marks a new era for Lolafilms," he said. "We have invested an unimaginable quantity in developing projects - a third of Lola's resources. We have 30 or 35 films with different directors in development," he added.

Gomez is capitalising on the autumn sale of 70% of Lola's shares to telecom outfit

Telefonica, which raised Lola's share capital to an impressive pts3,000m ($19m). Gomez plans to "double his annual production" slate from five or six films to between 10 and 12, aiming for 50 films over the next five years.

In addition, Gomez aims to bolster his move into English language production. Currently in development is: John Malkovich's The Dancer Upstairs, starring Javier Bardem and planned for an April shoot; Susan Seidelman's Gaudi Afternoon, with Judy Davis and Lily Taylor; Carlos Saura's The Maid Of Buttermere, shooting in the UK in February with Colin Firth; and Manuel Gomez Pereira's three tenors satire Off Key, shooting in April. Gomez is still in talks with RKO on co-production The Haunted Heart, a remake of the 1947 classic They Won't Believe Me to be directed by Fernando Trueba.

Average budgets on English language product, for which Lola's fledgling London office handles world rights, is $7.5m, while that for Spanish language product is $3.3m. Spanish language films in development include: Bigas Luna's Son De Mar; Fernando Trueba's El Embrujo De Shanghai starring Javier Bardem and Ariadna Gil; Alex de la Iglesia's Donde Acaba El Arco and Iris and Manuel Iborra's Beatriz Y Los Cuerpos Celestes.