Indie finance firm launches with $900 mil

NatWest/Coutts Bank’s Rodney Payne, Hal Sadoff and Myles Nestel have teamed with financial advisers Alton Irby and Richard Milne to form MM Media Capital Partners LLC, an independent film financing company armed with a $900 million war chest.

With offices in Beverly Hills and London, the newly launched firm already has backed producer Chuck Gordon and director Mike Newell (“Four Weddings and a Funeral”) in multipic credit facilities.

Gordon’s deal, announced Friday (Daily Variety, Oct. 1), gives the producer access to $500 million in a revolving, gap finance line of credit.

Newell’s new banner, Fifty Cannon Entertainment, will receive a $300 million facility. Details on that pact are forthcoming.

Name recognition

In single-pic deals, Media Capital also is helping to fund an HBO film from producer Joel Silver as well as Robert Altman’s latest outing, “Dr. T and the Women,” starring Richard Gere.

Media Capital will continue existing ties that stem from the partners’ NatWest tenure with Silver Pictures and Shanghai’d Films, the production company of director Ron Shelton (“White Men Can’t Jump,” “Play It to the Bone”) and producer Stephen Chin. These relationships could translate to multi-film financing arrangements in the future.

Media Capital’s nearly $1 billion annual lending fund is being underwritten by a syndicate of international banks: the UK’s NatWest, Germany’s DG Bank and Los Angeles-based City National Bank.

With these funds, Media Capital will provide financing for film and television projects on single pictures and on slates of films, with the ability to back all budget levels, from the small indies to studio-level pics, through gap financing.

Aside from the overall dollar amount, the move is significant because Media Capital also will have funding available to cash-flow pre-production costs; and, in some cases, the firm could purchase foreign distribution rights and partner with a sales company, thus gaining an equity interest in the pics and own a piece of the copyright.

Broad gameplan

Drawing from their extensive financial/banking backgrounds, the partners also intend to introduce a range of services that include tax-based financing, sale and lease-backs, library acquisitions and asset-backed securitizations.

While the principals have existing or former ties to NatWest, they stress that Media Capital is an autonomous company, solely owned by the five partners.

“The formation of MCP, free from the bureaucratic restrictions imposed by large financial institutions, will allow us to react more quickly to the needs of our customers,” Payne said. “Our offices in London and Beverly Hills and our wide-ranging international experience will allow us to bring to the producer opportunities, which are a prerequisite for modern film and television financing.”

Valuable expertise

Irby, who is the London-based chairman of Media Capital, also serves as chief exec of both NatWest Corporate Advisory and corporate finance firm Hawkpoint Partners Ltd.

Milne also serves as the chief operating officer of Hawkpoint Partners.

Payne, a veteran media financier, had been a partner at venerable London-based Coutts Bank, and, along with Sadoff and Nestel, was part of the core management group for the entertainment division of NatWest/Coutts Bank.

Payne will head up Media Capital’s London office, while Sadoff, who was senior veep and L.A. head of NatWest Bank Media Finance Group, will oversee the firm’s Beverly Hills office along with Nestel, who previously was an exec at NatWest Media Banking Group. Arnaud Levy will round out the staff at Media Capital’s Beverly Hills office.

Media Capital’s debut comes at a time when the U.S. majors are looking for financing partners to hedge their risks and it’s become harder to find financing for independent films.

While insurance companies and foreign (mainly European) media congloms have been active players in the film financing marketplace in recent years, since the demise of Credit Lyonnais, there hasn’t really been a bank focused on financing large numbers of independent films. The principals maintain that Media Capital represents for the first time in several years, the presence of substantial but stable, bank-backed equity financing for independent films of all budget ranges.

“This is back-to-basics financing for the entertainment industry,” Sadoff said. Media Capital “will provide producers with the ability to independently finance films, in all budget levels, on a basis that makes good economic sense.”

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