Quebec government investment arm pulls out of film biz
Canada’s Investissement Quebec is moving forward with the sale of its stake in Canuck distrib Alliance Films along with co-owner Goldman Sachs, which put its share on the block this month (Daily Variety, Jan. 2).
The Quebec government’s investment arm lost big bucks with its foray into the film industry — not just with Alliance but also with Lionsgate and Dark Castle.
Now it’s getting out of the biz altogether.
“Investissement Quebec will not be investing in cinema,” said spokesperson Chantal Corbeil, adding it would plough funds into natural resources and information technology.
Last year, IQ merged with the Societe Generale de Financement, another Quebec government investment arm, and it was SGF that had bought into Alliance, paying $99 million in 2008 to acquire 51% of voting shares and 38.5% of the equity. The rest is held by Goldman Sachs.
SGF had also signed a $400 million financing deal with Lionsgate in 2007 in a bid to bring film and TV productions to Quebec. But that deal soon fizzled and only one production ever shot in the province as a result of the deal.
The same year SGF inked a similar deal with Joel Silver’s Dark Castle Entertainment, but that agreement also under-performed.
When he left the top job last year, former SGF CEO Pierre Shedleur said that the film investments could end up costing SGF $74 million.
Corbeil said the loss is less than that now because Alliance had a good 2011, largely thanks to the success of “The King’s Speech,” which it co-financed.
All SGF’s film investments were designed to boost the local film business but there is little evidence that this was an effective strategy. Alliance Films did, on paper, move its head office to Montreal but its top execs, Victor Loewy and Charles Layton, continued to mostly work out of Toronto.