Co. restructuring to focus on core TV biz

LONDON — ITV broadcaster Granada will announce today that it is scaling back film production investment and closing movie arm Granada Film — a blow to the U.K. industry and U.S. indie filmmaking.

Granada’s decision to withdraw from active production after 13 years, dating back to the Oscar-winning “My Left Foot,” follows Channel 4’s decision to close its movie arm, FilmFour. It leaves pubcaster the BBC as the only British broadcaster not cutting back on its commitment to the movie business.

Granada will honor its commitment to produce and co-finance with Focus Features the Mira Nair pic “Vanity Fair,” which is about to start pre-production, and Craig Ferguson’s “All-American Man,” slated to shoot in April. Other projects will go into turnaround.

Execs to carry on

Granada Film toppers Pippa Cross and Jeanette Day are leaving to launch an indie production and sales company, and are negotiating to take Granada Film’s development slate with them. They will continue to oversee “Vanity Fair” and “All-American Man” on Granada’s behalf.

The news reflects the severe financial pressure that the ITV company is under. Ironically, Granada Film itself is in a better state of creative and financial health than at any time in its checkered history.

In the mid-1990s, its activities slowed almost to a standstill, but recent pics such as “Ghost World” and “Bloody Sunday” have earned international kudos. Brian Gilbert’s $18 million chiller “The Gathering,” the most expensive movie ever made by Granada, was picked up at the Cannes Film Festival by Miramax in a multi-territory deal.

Digital downfall

But after the disastrous losses incurred by the ill-fated ITV Digital pay TV venture, and a slump in ITV’s ratings and ad revenues, Granada is restructuring to focus on its core TV broadcasting and production activities.

Granada Film founder Steve Morrison recently announced his retirement as Granada’s chief exec, leading to speculation that the movie arm might be in jeopardy without his protection. But insiders claim that his exit was unrelated to the division’s closure.

Cross and Day will inherit a strong slate of projects in advanced stages of development when they segue to their new indie career.

“Vanity Fair” and “All-American Man” are coming to a boil after a long development history. Upcoming projects include “Found in the Street,” from John Malkovich’s Mr. Mudd shingle with Fox co-financing; “Roofworld,” a co-venture with Fine Line; and “The Giraffe,” a period comedy.

It is understood that Cross and Day’s shingle will have a close relationship with Granada, attempting to bring these remaining projects to fruition on Granada’s behalf, with the possibility that the ITV company might provide production investment on a case-by-case basis. Such issues are being negotiated.

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