MacMillan sets path for Alliance Atlantis
TORONTO — Alliance Atlantis is open and trolling for business. Michael MacMillan, chairman and CEO of the newly merged company, introduced its senior management and board of directors Friday, and said the company will grow through acquisitions.
MacMillan may not have former Alliance topper Robert Lantos’ charisma, but he sure talked the joint up, offering management, journalists and analysts a Valedictorian-style “the sum is greater than its parts” pep talk and crediting Alliance Atlantis employees with the company’s productivity. “This is day five of the merger,” MacMillan said, “and I’m happy that we’re getting out of the blocks with this speed and focus.”
MacMillan spoke effusively of the advantages of the merger, the clout the company will have competing with the major players in Hollywood, the C$20 million ($13.2 million) a year the new company will save eliminating duplication, and its ability to attract and nurture the brightest and the best talent in a studio-style capacity.
“The future of our company is for sure international, because that’s the future of this industry,” he said.
MacMillan noted that because the TV side of the business has reached what he considers to be a “critical mass,” the company’s goal for now will be to improve quality and profit margin rather than to grow to a significant extent. The feature side of the business will remain as it was under Lantos at Alliance, focusing on “upscale, director-driven motion pictures.”
MacMillan noted that the company plans to expand its cable business, by launching new cable channels (it currently has nine applications for specialty channels pending) and through acquisition. The company cannot merge the four specialty channels held by Alliance and Atlantis until it receives the approval of the Canadian broadcast regulator, which it expects to obtain in the first half of 1999.
The company will reduce its staff by about 100 jobs, “focusing on the duplicative administrative functions” MacMillan said, through job elimination, attrition and by not filling existing positions. MacMillan noted that the job reductions should be spread across the board, with the exception of the motion picture division, since Atlantis was not involved in that area before, and there is no duplication there. The merger will generate one time cash costs of $33.1 million, primarily in severance and professional fees.
The company also closed a committed credit facility of $314.2 million, plus another $46.3 million from the Royal Bank of Canada. The shares of the merged company will trade on the Toronto and Montreal stock exchanges and on NASDAQ. The Alliance office in Toronto will become the company’s new head office, although its Atlantis offices will remain open.
Former Alliance helmer Robert Lantos, who will not have any managerial role in the merged company, will produce the company’s current projects, “and then there’s the Alliance Atlantis slate, which is starting fresh. We’re actively seeking projects,” he said. “We’re going to start some very intensive meetings in the next two weeks seeking direction.”
Internationally, the company plans to begin to finance films in addition to distributing.
Of the top six positions — MacMillan, motion picture group chairman Victor Loewy, Lewis Rose as prexy of Alliance Atlantis Communications, Seaton McLean as prexy of television production, Peter Sussman in L.A. as prexy of Alliance Atlantis Entertainment, and Ted Riley as prexy of TV distribution — four are filled by former Atlantis execs. Loewy is the sole Alliance alumnus.
Beyond the top layer, however, the senior management team is an almost even split between the two companies.