BERLIN — Germany’s second-biggest film producer-distrib, Senator Entertainment, filed for insolvency protection Thursday in Berlin. Company had warned last month that it was on the verge of bankruptcy due to massive writedowns. It has been plagued by financial difficulties stemming from a severe devaluation of its film library and investments that drained its capital.
Parent company Senator Entertainment’s core divisions Senator Film Produktion, distrib arm Senator Film Verleih and distrib service company Central Filmvertriebs also filed for insolvency.
More stable abroad
Company’s overseas operations, including Senator U.S. Holding, which encompasses world sales division Senator Intl. and Ireland-based Eurofilm & Media, which owns London-based Amberlon Pictures, have been spared from insolvency for the time being. They are structurally separate from the group’s German operations.
Senator spokesman Karl-Wilhelm Homburg said it was too early to say what effect the insolvency would have on the company’s international holdings, adding that a number of avenues remained open for the group.
Senator is in negotiations with banks and potential investors but was forced to file for insolvency after failing to find a solution within a statutory period. It will work with a court-appointed insolvency administrator to continue negotiations with the parties.
A number of German media companies are said to be interested in Senator, although it is unclear whether potential investors would take over the whole company or pick up choice assets.
Senator holds a 57% stake in Berlin-based X Filme, producer of last year’s hit comedy “Good Bye, Lenin!”; a 25% share in the money-losing multiplex chain CinemaxX, which has long depressed Senator’s bottom line; and a number of other media-related shareholdings.
No bounce from B.O.
Move comes despite recent box office hits including “The Miracle of Bern,” about West Germany’s 1954 World Cup soccer victory. “Lenin” and “Miracle” together grossed nearly $75 million at the local box office.
The group also has been hit hard by the dire exhib market, worsening trends in the domestic and international license business, and the lasting effects from output deals with Revolution Studios and FilmFour that were terminated in 2002 after a string of flops.