Moscow studio begins privatization program

MOSCOW — Russia’s second-largest studio, Moscow-based Gorky Film, will begin privatization in February. It’s the first phase of an expected move that will gradually move other facilities into private hands.

A 25% controlling stake will remain with the Russian government. Deal follows a year of legal maneuvering that has seen the facility transformed into a company whose stock is 100% owned by the state.

It also marks the end of a period of instability at Gorky Film, which has now overcome financial difficulties associated with previous director Vladimir Grammatnikov.

New topper Stanislav Yershov took over the position as Gorky’s director general in December 2002 as, effectively, a crisis manager, and has overseen the transition to privatization. Previously, he was associated with Russia’s Culture Foundation, run by industry leader and helmer Nikita Mikhalkov, as well as with St. Petersburg’s internationally acclaimed opera and ballet troupe, the Mariinsky Theater.

Gorky Film will be effectively split into two units — one controlling the studio’s Soviet-era archive, which will remain state property, the other controlling its property, which will be privatized.

Like Russia’s oldest studio, the St. Petersburg-based Lenfilm, which will likely be the next candidate for privatization, Gorky’s archive had been sold on a long-term deal, running originally through to 2008 but extended to 2016, to TV outlets associated with Vladimir Gusinsky’s once-dominant Media-Most group.

Meanwhile, privatization at leading studio Mosfilm is being strongly resisted by studio director and helmer Karen Shakhnazarov. Mosfilm has not sold its archive, and funds ongoing projects from library sales to TV, as well as rental of facilities.

Gorky Film has also updated technical services over 2003, installing a state-of-the-art

sound studio, which will come on line by May. Its restored lab facility is also now dominant in the territory, processing around 1 million meters of stock in 2003– more than at Mosfilm, according to Yershov.

With Gorky situated in northern Moscow, and connected by cable directly to city’s Ostankino television transmission tower, among the likely bidders may be major TV players, including national Channel One, and web Ren-TV, Yershov told Variety.

The auction is likely to exclude foreign players.

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