United International Pictures (UIP) and Buena Vista International (BVI) are to rationalise their theatrical distribution operations in parts of Scandinavia.
BVI will close its distribution operations in Denmark and sub-distribute its films through the Danish branch of UIP. In Finland the situation is reversed; with UIP closing and instead routing its studio parents' pictures through the Helsinki offices of BVI.
The new arrangement takes effect from October 1 in Denmark and from a yet-to-be-determined date shortly after in Finland.
"It is easy to see why this makes sense. It will be more effective to run a company with more product flow," said UIP president Stewart Till. "It is tough to run a full company in these two territories, which are two of the smaller ones in Europe, especially when local product takes such a big slice of the market," said Till.
"Every year we [BVI] review our operations worldwide. We looked at the relative strength of each in Denmark and Sweden and came to the conclusion that this is the way forward. Both we and UIP were looking to increase strength and efficiency," said BVI president Mark Zoradi. "Although it was a close call how to do it, UIP felt strongly about its Danish operation and we were keen to continue to support our local production in Finland, which has been more extensive than that in Denmark."
The two companies already have similar arrangements in Central America. In Turkey BVI films have been distributed via UIP for several year, while BVI has handled UIP in Venezuela for the last two years.
Each studio will continue to put up p&a for its own pictures and pay fees to the local distributor, which will provide distribution, marketing and support in the same way that they do in Central America, Turkey and Venezuela and UIP does for its studio owners.
Although the local offices will be handling product from four studio sources - Universal, Paramount, Dreamworks SKG and BVI - the studios do not necessarily hold international rights to all their films, especially in Scandinavia. The distributors estimate that the streamlined Danish and Finnish operations will each handle 25-40 titles per year.
Although the size of the remaining distribution units in both countries will increase slightly, there will be a net loss of jobs in Copenhagen and Helsinki. The Danish operations will be headed by general manager Michael Berg, currently head of UIP in Denmark and in Finland by BVI's general manager Jussi Makela.
Danish sources suggest that local competition authorities were approached in both countries prior to the deals being agreed.