×

Winchester loading financier Cobalt

Payne to join board, Sadoff to ankle

Publicly traded Winchester Entertainment has agreed to buy Cobalt Pictures, the Los Angeles and London-based sales and financing company behind Disney’s “Open Range” and DreamWorks’ “The House of Sand and Fog.”

Cobalt’s London-based principal, Rodney Payne, will join the Winchester board. He will continue to run Cobalt as a film-financing label under the name Cobalt Media Capital.

Hal Sadoff, Cobalt’s Los Angeles partner, will ankle the company. Cobalt owners Alton Irby and John Muse will take a 20% stake in Winchester.

The deal reps a consolidation with an eye toward weathering the storms that have beset the foreign sales sector.

“This transaction will be a further step in building Winchester’s feature film business and will bring in two strong shareholders who are fully supportive of the company’s strategy,” said Winchester CEO Gary Smith.

“We will add to our cash, strengthen our film library with more studio films and introduce an experienced and highly skilled film financing and sales capability.”

Winchester will pay for the deal by issuing new shares to Irby and Muse in two stages. The duo will get a 10% stake on the deal’s completion, with the option to buy another 10% at a fixed price a year later.

At its current stock price, Winchester is effectively paying $470,000 for Cobalt, and assumes no outstanding liabilities.

Irby and Muse would have to pay $590,000 to exercise their warrants on the second set of shares.

Back to Cobalt’s roots

Payne’s unit will be run with a view toward providing financing not only for Winchester pics, but also for projects with other sales companies.

That is how Cobalt first operated when it launched four years ago under the name MM Media Capital Partners, before it set up its own sales operation.

“We have had a longstanding relationship with Winchester,” said Irby. “Our last collaboration was on ‘Heartbreakers,’ which proved a great financial success for both Winchester and Cobalt. We look forward to more success in the future.”

Cobalt’s current slate also includes Richard Donner’s Paramount pic “Timeline.” Previous titles include “Swimfan” and “Danny Deckchair.”

Irby and Muse previously invested their own equity in most Cobalt movies and will consider such deals for upcoming projects with Winchester.

“We have done that in the past, and there’s no reason why we won’t continue to do so in the future,” Irby said.

He emphasized that he and Muse intend to be long-term investors in Winchester.

Winchester’s slate includes the Klasky Csupo pic “The Way the Dead Love,” Aussie comedy “The Night They Called It a Day” and a movie version of the cult Brit TV series “Red Dwarf.” It has a development deal with the Donners’ Co.

The stock market reacted positively to news of the Cobalt acquisition, pushing Winchester’s share price up 15% to $0.25 and raising its market capitalization to $6.7 million. The company estimates its net asset value at $33 million.

More Film

  • Peter Rabbit trailer

    Australia Box Office Recovers, Grows 3.8% in 2018

    Gross theatrical box office in Australia grew by 3.6% in 2018, to $890 million (A$1.25 billion). The score was propelled by a rebound in the performance of the top local films. Data from the Motion Picture Distributors Association of Australia published Tuesday showed aggregate cinema revenues recovering after a dip in 2017. While the 2018 [...]

  • Megan Mullally70th Primetime Emmy Awards, Arrivals,

    Q&A: Why Megan Mullally Won't Talk Politics While Hosting the SAG Awards

    Megan Mullally is funny. The “Will & Grace” star can also sing and dance. While she’s not picking up the Oscar hosting gig after the Kevin Hart fiasco, Mullally will take center stage on Sunday, Jan. 27 when she makes her debut as the host of the 25th annual SAG Awards. Variety caught up with [...]

  • Glass trailer

    'Glass': Five Box Office Takeaways From M. Night Shyamalan's Thriller

    With his fifth No. 1 box office opening, M. Night Shyamalan has plenty to celebrate. “Glass,” the conclusion to a trilogy that consists of the 2000 cult hit “Unbreakable” and 2016’s box office sensation “Split,” topped the box office last weekend — though its win comes with a few caveats. James McAvoy reprised his role [...]

  • Berlin: Patra Spanou Picks Up Panorama

    Berlin: Patra Spanou Picks Up Panorama Title 'Family Members' (EXCLUSIVE)

    Patra Spanou has picked up world sales rights to “Los miembros de la familia” (Family Members), which will world premiere in the Berlin Film Festival’s Panorama section. Variety has been given an exclusive first look of the film’s trailer. The film is the second feature from writer/director Mateo Bendesky, and is produced by Agustina Costa [...]

  • Great Point Media, The Development Partnership

    Great Point Media, Development Partnership Join Forces on Slate of Movies

    Great Point Media and The Development Partnership, the development and production arm of the talent agency the Artists Partnership, are joining forces to develop, package, and co-produce multiple films, kicking off with three projects, including “Chasing Agent Freegard,” starring James Norton (“War & Peace”). “Chasing Agent Freegard,” which is being produced by “Captain Phillips” co-producer [...]

  • Berlin: FiGa Acquires ‘Landless,’ Drops ‘Hormigas’

    Berlin: FiGa Acquires ‘Landless,’ Drops ‘Hormigas’ Trailer (EXCLUSIVE)

    Sandro Fiorin’s Miami-based FiGa Films, a leading sales agent on the independent Latin American scene, has announced the acquisition of Brazilian doc “Landless,” and released a trailer for the Costa Rican-Spanish drama “El despertar de las hormigas.” Both features will play at this year’s Berlinale Forum and come from young Latin American filmmakers making their [...]

  • Ryan Reynolds Cancels Arm Surgery to

    Ryan Reynolds Cancels Arm Surgery to Promote 'Deadpool 2' in China

    Ryan Reynolds canceled surgery on his arm to fly to China and charm “Deadpool” fans in Beijing on Sunday ahead of the franchise’s unexpected China theatrical debut. Just last week, Fox suddenly announced that a re-cut, PG-13 “Deadpool 2” would hit Chinese theaters starting this Friday – the first time the notoriously blood-splattered and foul-mouthed [...]

More From Our Brands

Access exclusive content