German producer-distributor Senator Entertainment's deal with Joe Roth's Revolution Studios is likely to be revised as part of a wide-ranging review of its financial and production strategies. Joe Drake's Senator International sales arm is likely to be expanded.
The news emerged as Senator signed a three-year Euros230m syndicated loan agreement with a consortium of German banks. The new cash is intended to allow expansion of international production and licence trading and to strengthen its market position in Germany.
Crucially, Senator said that it had adapted its strategy as a result of rapid changes in the market and that it would "again take full control of film production and purchasing decisions".
All of the Senator's existing exclusive co-operation agreements would now be subject to review, the company said in a statement.
The output deal with Revolution Studios: "has been modified without cost impact and limited with respect to the number of films to be purchased and the volume of investments to be made".
The deal gave Senator exclusive access for the next five years to films from Revolution Studios. In return for payment of a percentage of the production costs, Senator received the German speaking rights for up to 20 years, but had no influence on the production. It was planned for the deal to cover 5-6 films with an average budget of $40m.
However, the first two films from the deal - Animal and America's Sweethearts - "unfortunately did not achieved the high expectations in the German speaking area," according to Senator's third quarter report. Senator had anticipated that America's Sweethearts would attract three million spectators, but it only reached 1.2m admissions in Germany.
The new loan will mainly be used to expand the international production and licensing activities of Los Angeles-based Senator International. "We are now very firmly in position to execute our ambitious plan and look forward to putting these funds to work", said Senator International president Drake.