You will be redirected back to your article in seconds

CIBC, Union Bank credit Village Roadshow

$400 million line extended to indie

Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday.

The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the past couple of years, mark the first time either CIBC or Union Bank have played a lead role in arranging film financings, although both have participated in such deals arranged by other banks in the past.

Village covered for 3-5 years

Banking sources say CIBC arranged a $200-million production financing, to cover Village’s output over the next three to five years, which is expected to range between 20 and 30 pics.

Additionally, CIBC and Union Bank arranged a similar sized post-production facility that will effectively buy the completed pics, allowing for repayment of the production line. Both facilities are revolving, which means they can be drawn down again as they are repaid.

But unlike most other off-balance-sheet film deals done recently, the post-production facility will not own all rights to Village Roadshow’s pics because Warner Bros. has domestic and most foreign distribution rights to films covered by its deal with Village.

Warners’ 20-pic deal includes covering a portion of the pics’ budgets on completion, sources said. Additionally, the financing is believed to also cover costs of pics made under Village’s deal with Dustin Hoffman’s company.

In fact, Village Roadshow’s U.S. operational staff was kept largely out of the negotiations on the credit lines, sources said.

Latest twist in trend

The film financings are the latest twist in the gradually evolving off-balance-sheet trend, begun by Citicorp with $1 billion-plus facilities done for News Corp.’s 20th Century Fox and Seagram Co.’s Universal Studios in the past in April, Time Warner’s New Line Cinema arranged a total of $750 million in off-balance-sheet film financing. Like the Village deals, New Line’s financings were split between a production financing and a post-production facility.

But the size of the deals continues to shrink, raising the risk of the loans, some bankers say. Village’s facility not only covers fewer films than the Citibank deals with Fox or U, but the post-production line also covers foreign rights only.

Bankers said Wednesday that both CIBC and Union Bank want to upgrade their presence in entertainment lending. CIBC last year led a $125 million bond issue for theater concern Livent Inc. while Union Bank is believed to have recently hired banker Joe Wolf to run its film-financing unit.

Union Bank reps could not be reached for comment Wednesday and CIBC execs did not return calls. Village Roadshow also declined to discuss the deal.

(Benedict Carver in Los Angeles contributed to this report.)

More Biz

  • Harvey Weinstein ousted

    Weinstein Co. Adds Board Member to Navigate Bankruptcy Sale

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

  • Allison Mack

    'Smallville' Actress Allison Mack Arrested in Sex Cult Case

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

  • Harvey Weinstein

    Harvey Weinstein Still Seeking His Emails to Combat Sexual Assault Claims

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

  • Ken Ziffren and Claudia EllerVariety Power

    Attorney Ken Ziffren Offers Sobering Take on Film Business at Variety's Power of Law Breakfast

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

  • ynon-kreiz

    Media Exec Ynon Kreiz Named CEO of Mattel

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

  • courtney braun

    Courtney Braun Named Head of Legal Affairs for Endeavor

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

  • Randall Stephenson

    AT&T-Time Warner Trial: Randall Stephenson Takes Stand and Defends Merger

    Village Roadshow Corp. has arranged a total of almost $400 million in two film-financing credit lines from CIBC and Union Bank of California, funding the Australia-based indie’s film production plans over the next five years, banking sources said Wednesday. The deals, similar to many of the off-balance-sheet film financings done for Hollywood majors in the […]

More From Our Brands

Access exclusive content