The Film Consortium has long been the ugly duckling of the U.K.’s three lottery franchises. It’s still some way from turning into a swan, but the company has at last found someone who fancies its chances.
Just before Christmas, Italian producer Domenico Procacci quietly picked up a 29% stake in Civilian Content, the publicly listed parent of the Film Consortium and its sister sales outfit, the Works.
Procacci, a longtime ally of Civilian managing director Chris Auty, paid £870,000 ($1.59 million) to buy out the company’s founder and largest shareholder, Richard Thompson, who had been seeking an exit since he quit the board two years ago. Auty also bought a 0.6% stake.
The deal finally ends the destabilizing uncertainty about Thompson’s intentions, and clears the way for the company to construct a coherent plan for life after TFC’s six-year lottery franchise finally expires in March.
Thompson, a millionaire wheeler-dealer with no previous film experience, created Civilian (then called Whitecliff) in 1999 from the shell of an old meat-processing company. It acquired TFC halfway through its franchise in 2000 and took over the Works to form a combined sales and production outfit.
But a string of flops caused heavy losses and management upheavals. The company scraped its first profit in 2002, when the Works handled “Bend It Like Beckham.” But 2003 was another hard year, with Stephen Fry‘s “Bright Young Things” and Michael Winterbottom‘s “Code 46” proving tougher than hoped.
The immediate upside of Thompson’s sellout is a cash injection. He has used the entire proceeds to repay his longstanding personal debt to Civilian. That alone has driven shares up by 30%, albeit from rock-bottom.
Procacci and Auty have yet to unveil the strategic vision for their alliance. But it’s not hard to see the mutual benefits of linking Fandango, Procacci’s fast-expanding production and distribution empire, with a London-based sales and financing operation.
Since scoring a big hit with Gabriele Muccino‘s “The Last Kiss” in 2001, Fandango has launched into Italian distribution, dipped its toe into publishing and set up an Australian production arm. Muccino’s latest pic, “Remember Me,” which will screen at Sundance, is already being sold by the Works.
Procacci is unusual among Italians in his enthusiasm for co-production with English-language territories, rather than more traditional partners in France or Spain. His international credits include Milcho Manchevski‘s ill-fated “Dust” (co-produced with Auty and TFC), Samantha Lang‘s “The Monkey’s Mask” and several Rolf De Heer movies, from “Bad Boy Bubby” to “Alexandra’s Project.”
His backing cements Auty’s position at Civilian. Thompson was, by his own admission, “not completely constructively supportive” of the existing management team, which also includes Works topper Aline Perry.
Thompson and Crispin Barker, Civilian’s chairman and its other leading shareholder, spent some of the past year exploring potential deals that would have resulted in wholesale management changes, including a merger with Artists Independent Network and a tie-up with Myriad Pictures.
Late last year, Thompson presented Civilian with two alternatives: Either find someone to buy him out at a price that would cover his debt to the company, or sell off the film operations and turn Civilian into a cash shell.
Auty found his white knight in Procacci and won Barker’s support to keep the company in the film business.
“It could be good for them, with me out of the picture,” Thompson says. “Chris is very much the man now, with the firm support of Fandango and Crispin, whereas before Chris was not quite sure where he stood because of me.”
So Thompson’s adventure in the film business is over for the time being. But he’ll be back. “Having had five or six years in the industry, I’m certainly out there as an investor looking to get involved again,” he says. “With Civilian I was proactive about creating the strategy, but I was very naive looking back, because I didn’t have any understanding or experience of the business. Now I’m looking to invest in up-and-running private companies with established management.”