Natixis Coficine, Spain’s Audiovisual SGR Strike $22 Million Spain Deal

New credit line sees Natixis discount against foreign sales estimates

Palms in the Snow
Alain Hernandez, Mario Casas and Emilio Gutierrez in "Palms in the Snow"

BARCELONA — Paris-based bank Natixis Coficine, Europe’s biggest film lender, and Spain’s Audiovisual SGR have pacted for SGR, a bank guarantee fund, to underwrite a €20 million ($21.7 million) 2015 Natixis Coficine credit facility for Spain’s cash-starved film and TV production sectors.

Unveiled at Spain’s Malaga Festival, its annual national film festival, the Natixis Coficine credit facility comes as the Spanish film industry still awaits direct subsidy payments for theatrical releases in 2012 and a long-mooted overhaul of its incentive system. In such a context, alternative financing tool is an imperative necessity.

Limiting Natixis Coficine risk exposure, the deal sees SGR putting up two guarantees: 50%-100%, up to €1.2 million ($1.3 million) of subsidies from Spain’s ICAA film agency, which runs Spain’s central subsidy fund; 50% maximum of international sales estimates. Together, though Natixis will sometimes extend larger credit facilities, SGR guarantees will not exceed €2 million ($2.1 million) per movie project.

Natixis will lend at a reduced interest level of on average 4% above the Euribor European inter-bank lending rate.

Costing a maximum fee basis of 1%, the annual facility is renewable and applies to films, movie projects and animation. Natixis Cofcine will consider loaning to Spain’s distribution and exhibition and also discount VOD platform contracts. “This agreement with Audiovisual SGR will enable Natixis Coficine to serve even better our Spanish clients and definitely puts us on the map as the preferred credit institution for film and TV in Spain,” said Natixis Coficine director Christophe Vidal.

“The agreement will alleviate the risk exposure for the producer as well as for us,” says Xavier Parache at Spain’s Gate Media, the Barcelona-based film finance consultancy and packager that represents Natixis Coficine in Spain.

Its lending against foreign sales estimates “is particularly important for big internationally driven productions,” Parache added, allowing producers to access money faster in the production process.

SGR guaranteed Natixis discounted ICAA subsidies, which are box office tabbed and paid two or more years after a film’s release, on three productions before its framework deal with Natixis: Fernando Gonzalez Molina’s “Palm Trees in the Snow,” Antonio Chavarrias’ “The Chosen” and Manuela Moreno’s “Girls Night Out.”

Natixis Coficine lent $813 million in 2014, including $66 million to Spanish productions. Part of Groupe BPCE, the second-largest banking group in France, Natixis finances on average 120 pics per year.

Underscoring Natixis’ build in Spain, Marc Lopez, a former director of Catalan state body ICEC’s audiovisual department, was tapped as a Gate Media financial consultant in January.

Founded in 2006, Madrid-based Audiovisual SGR is a mutual guarantee fund underwriting bank loans to Spain’s national film/TV production, distribution and exhibition sectors.

Audiovisual SGR was set up by Egeda, Spain’s producers’ rights collection society, and ICAA, the country’s main central film subsidy board, and is supported by other institutions like Fapae, Spain’s producers’ lobby.

In 2014, SGR underwrote $36 million in bank operations for Spain’s film industry, up from $29.3 million for 2013.