15 May, 2006
By Adam Dawtrey
Source: Variety.com
LONDON — ContentFilm is emerging from its chrysalis after a year of transformation. Once the archetypal Gotham indieindie, Content has undergone an extreme makeover to become a fully fledged British sales company with its own TV arm and a public listing in London.
Its film slate, previously laden with low-budget U.S. fare, is now packed by grizzled international auteurs, all north of 60 but discovering a new lease on life — Richard Attenborough, Paul Verhoeven, Peter Greenaway and Fred Schepisi.
Its TV arm Fireworks, acquired last July from CanWest for what now looks like the bargain price of $21.5 million, is profiting from the revival of the foreign TV market for drama, and pumping out new shows to bolster its library.
Since the start of the year, Content’s market capitalization has already doubled to around $20 million. With its library alone recently valued at $40 million, its stock has a lot of room left to grow. As the company’s paper gets more valuable, so Content intends to expand through further acquisitions of libraries and possibly TV production outfits, either in the U.K. or North America.
Content’s metamorphosis began in early 2004 when it reversed into the recently merged British sales and financing company Winchester/Cobalt, which was listed on London’s Alternative Investment Market.
But the big shift came a year ago, when Content announced its decision to pull out of film production. That meant a painful split with its co-founder Ed Pressman, the godfather of New York indie film-making.
That was a reaction to tough conditions in the production biz, particularly in Blighty, where sudden changes in tax rules had killed off the Entertainment Investor fund that was supposed to co-finance several Content projects. “The collapse of EI was the signal event that led us to say it’s a far too unpredictable and volatile activity to be our core business,” says Content chief financial officer Geoff Webb.
John Schmidt, the former October Films and Miramax exec who set up Content with Pressman in 2001, stayed at the helmhelm as CEO. He spearheaded the Fireworks takeover, which brought a library of 280 TV shows and movies, and an experienced sales team headed by Greg Phillips.
The purchase was financed with $30 million of debt, but strong sales have already slashed that figure to $15 million and enabled the company to retire nearly $9 million of mezzanine debt a year ahead of schedule. Effectively, Content has already earned more from the Fireworks library than it paid for it.
On the film side, Jamie Carmichael has led the switch toward bigger-budget, prestige projects. With Content no longer dipping into its own pocket to bankroll production, he needed projects he could finance through pre-sales. “The simplest and easiest path is to go with great directors,” Carmichael explains.
At Cannes last year, Content unveiled “Black Book,” Verhoeven’s $20 million WWII revenge drama now in post and most likely to bow at Venice.
Then came “Closing the Ring,” a $25 million romantic drama spanning WWII and Ulster during the Troubles, which marks the 82-year-old Attenborough’s first film in eight years. Shooting has just switched to Toronto after completing the Northern Ireland leg.
Now the company is putting together “Last Man,” a $20 million Vietnam War drama that marks the 76-year-old Schepisi’s first movie in his native Australia for 18 years. Shooting is set for this summer.
After many years on the arthouse fringes, Greenaway is gearing up to tackle a more mainstream subject with the $8 million Rembrandt biopicbiopic “Nightwatching,” starring Martin Freeman.
Although it no longer bankrolls such smaller U.S. indie fare as “Thank You for Smoking,” Content is still in the market to pick up the occasional completed pic, as Carmichael did successfully with “Transamerica.”
“I found ‘Transamerica’ lying alone, unloved. Everyone else had passed,” he recalls.
In the coming year, Carmichael wants to add a third strand to his roster, which he characterizes as “slightly broader American commercial cinema — the kind of action movie Steve McQueen would have made.”
Content has bounced back a long way from the dark days of early 2005, when several other U.K. sales outfits were going out of business. Content could easily have followed, but now it looks well placed to profit from the resurgence of the sales biz in film and TV.
