Mark Gill and Neil Sacker’s the Film Department is withdrawing its proposed initial public offering with the U.S. Securities and Exchange Commission as it closes in on $200 million in private financing that will fund the production, acquisition and U.S. release of five to 10 films a year.
This morning, the company withdrew its registration statement with SEC. TFD first filed for an IPO in December, but has been unable to woo investors, even after cutting the share price by more than half. (Daily Variety, August 4)
TFD execs are now focusing on negotiations with investors who prefer to keep the company in private hands.
The $200 million in new funding would be a combination of equity and debt. Part of it would be used to launch a U.S. marketing an distribution arm.
Also, TFD announced several key updates, including closing a U.S. homevid deal with 20th Century Fox.
And TFD has set a release date for Catherine Zeta-Jones starrer “The Rebound.” Pic, which already has been released overseas, will open nationwide on Dec. 25 via TFD’s distribution deal with the Weinstein Co.
And TFD has completed production and is targeting a first quarter 2011 release for “Earthbound,” starring Kate Hudson, Gael Garcia Bernal, Whoopi Goldberg and Kathy Bates.
While it wasn’t able to launch its IPO, TFD says it has improved its financial position over the last 12 months by paying off more than $60 million in debt and raising $15 million in additional private equity.
However, TFD still faces substantial debt, according to SEC filings. Had it closed the IPO and raised net proceeds of more than $30 million, it still would have faced more than $25 in debt.
That debt could be resolved once TFD finalizes its new round of financing.
“We’re thrilled to be coming out of a very difficult period for the entire independent film business with a great deal of momentum,” said Gill, who is TFD chair-CEO. “We’re now on track to expand and to take advantage of the enormous market opportunity in U.S. distribution, which is far greater than anything I’ve seen in 25 years in this business.”
Sacker, who is vice chair/COO added: “We’re grateful to all of the investors and finance industry veterans who have continued to support us in this transition, among them Mike Goguen, Michael Singer, Guy Inzalaco, Waleed Al Ibrahim, Zeid Masri, Roy Salter, Mike Witherill, Jon Merriman, Peter Coleman and their team at Merriman Curhan Ford, Bryan LaCour and his Union Bank entertainment group, and Joe Crabb and his team at Squire Sanders. And we’re excited to be in business with everyone at 20th Fox Home Entertainment, which is widely and rightly regarded as an industry leader.”
TFD’s mandate is to produce star-driven, commercial movies with net budgets of between $10 and $45 million.
Company didn’t say when the $200 million in new financing would be closed.