Pathe, Canal + in distrib pact

PARIS — Two of France’s entertainment heavyweights, pay TV giant Canal Plus and Pathe, have teamed to establish a European film distribution network. It’s the latest step by both groups to establish a significant film presence within Europe.

Pathe and Canal Plus, which are increasingly working together, already have extensive interests in pay and digital television, theatrical exhibition, TV and film production.

The pact was signed by Pathe chairman Jerome Seydoux and his Canal Plus counterpart Pierre Lescure during the Cannes Film Festival, but was just revealed this week.

The agreement reaffirms that Pathe and Canal Plus are refocusing their film strategy away from Hollywood, where Canal Plus got its fingers burned with a stake in Carolco and where Pathe was burned after financing the still-unreleased “Lolita” and B.O. disappointment “Showgirls.”

Canal Plus’ Lescure has made this shift in policy quite clear, while Pathe’s Seydoux has indicated he will not be repeating the kind of financing deals that were done on “Lolita” and “Showgirls.”

The new agreement initially brings together distribution companies in France (AMLF), the U.K. (Guild Pathe), Germany (Tobis) and Spain (Sogepaq). A fifth distrib, in Italy, is expected to join the network within the next few weeks, although senior Canal Plus and Pathe execs, talking to Daily Variety, would not hint at the identity of the Italian partner.

AMLF and Guild are wholly owned by Pathe, which also is the major shareholder (36%) in German distrib Tobis.

Canal Plus has a stake in Madrid-based distribution company Sogepaq, via Spanish holding company Sogecable in which Canal Plus has a 25% share.

Eye toward Italy

According to Vincent Grimond, senior exec VP of Canal Plus group subsidiaries, his company could eventually take an equity stake in an Italian distributor.

In a statement released Wednesday, Pathe and Canal Plus noted, “The main objective of this association is to promote distribution of locally produced European movies in Europe. The network will allow for the distribution of movies produced or acquired by Pathe and Canal Plus.”

Added to this, the two sides are setting up a joint venture to acquire European rights to non-European pics, principally from the U.S.

Pathe exec VP Michel Crepon says, “When we acquire these kinds of films they will be released via our distribution network. This gives us the possibility to negotiate for European rights because we know we can guarantee distribution.”

Crepon and Grimond stress that the exact number of pics set to head through the distribution pipeline is difficult to quantify. While those films acquired jointly are destined automatically for distribution in the five territories, other pics will tend to be dealt with on a case-by-case basis.

“Each individual distributor will still be able to acquire films simply for its own territory,” Crepon notes. “There may also be projects that don’t appear suitable for a particular territory within the distribution network.”

The distribution network has a considerable source of films from which to draw. Pathe steadily has been developing its film production investments. These now include 100% of Claude Berri’s Renn Prods., a 45% share in Jake Ebert’s Allied Filmmakers, London-based Pathe Prods. and the lead role in Pathe Pictures.

For its part, Canal Plus owns 100% of Studio Canal Plus, which has just under 50% of Les Films Alain Sarde. Studio Canal Plus also has a London-based film production joint venture TOC with Charles Gassot’s French production company Telema.

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