Company has liabilities over $58 mil
MONTREAL — Veteran Canuck animation producer CineGroupe has filed for protection from its creditors in an attempt to restructure and stave off bankruptcy.
The Montreal-based company, whose productions include “Mega Babies” and PBS kids series “Sagwa, the Chinese Siamese Cat,” has liabilities of more than C$75 million ($58 million), including $17 million to Canada’s Banque Nationale. Lions Gate Entertainment owns around 30% of CineGroupe, a privately held company.
CineGroupe expanded aggressively over the past few years, ramping up production and hiring new staffers. In December, it cut 30 positions due to a slowdown in production.
The company’s highest-profile new project is “P3K: Pinocchio 3000,” Canada’s first full-length 3-D animation pic, featuring the voices of Malcolm McDowell, Howie Mandel and Whoopi Goldberg.
A spokesman for CineGroupe said that the production house is still in business and is working on several projects, including animation series “Tripping the Rift,” which bows on Sci Fi in March, and “11 Somerset,” a live-action series for the Chum-owned Space Channel in Canada.
“We moved from 2-D animation to 3-D, which was very costly, and at the same time the international market fell apart,” said the spokesman. “We’re now working to restructure the company.”
In 2001 La Societe Generale de Financement, a Quebec government agency, injected $11 million into CineGroupe, which it wrote off as a loss as part of its past year’s financial results. One of the company’s main shareholders is president and CEO Jacques Pettigrew.
CineGroupe is under the stewardship of Ernst & Young, which was appointed by Quebec Superior Court to oversee the restructuring. It will submit its restructuring plan to the court in the next few weeks.