The Film Department has withdrawn its plan for an initial public offering and says it is in negotiation with investors “who prefer to keep the company in private hands” for $200m in equity and debt.
The announcement came after the US independent cut the price of its planned public offering, first announced last December, for a second time, a move suggesting the offering was not attracting enough investors.
Now the company, headed by Mark Gill and Neil Sacker, says it will use the new backing from its private investors to finance the production, acquisition and, through a new distribution arm, US release of 5-10 films a year.
Noting several other developments that should improve its financial situation the company said it has signed a US home entertainment deal with Twentieth-Century Fox and reached an agreement for its films to be screened by Showtime in the US pay TV window. The films will go to Showtime via The Weinstein Co (Gill worked under Bob and Harvey Weinstein at Miramax).
Also announced were a December 25 wide US release (again with The Weinstein Co) of Catherine Zeta-Jones romantic comedy The Rebound and the completion of Kate Hudson love story Earthbound, now targeted for release in the first quarter of next year.
Film Department said that over the last year it has improved its financial position by more than $75m, paying off more than $60 million in debt and raising $15 million in additional private equity. In the same period, the company said, more than $85 million in revenues and anticipated proceeds from films has been generated. The company’s $40m production Law Abiding Citizen has earned more than $120m at the box office worldwide.
Company chairman and CEO Gill said in a statement: “We’re thrilled to be coming out of a very difficult period for the entire independent film business with a great deal of momentum. We’re now on track to expand and to take advantage of the enormous market opportunity in US distribution, which is far greater than anything I’ve seen in 25 years in this business.”
Vice chairman and COO Sacker added: “We’re grateful to all of the investors and finance industry veterans who have continued to support us in this transition, among them Mike Goguen, Michael Singer, Guy Inzalaco, Waleed Al Ibrahim, Zeid Masri, Roy Salter, Mike Witherill, Jon Merriman, Peter Coleman and their team at Merriman Curhan Ford, Bryan LaCour and his Union Bank entertainment group, and Joe Crabb and his team at Squire Sanders. And we’re excited to be in business with everyone at Twentieth-Century Fox Home Entertainment, which is widely and rightly regarded as an industry leader.”