PARIS — Aiming to steady its financial footing after a tough year marked by its merger with Senator, Paris-based Wild Bunch AG is finalizing a deal to sell a portion of its extensive library to Orange Studio, the film subsidiary of France’s leading telco company Orange, Variety has learned.
The deal, which will be officially unveiled in the coming months, is expected to cover about 10% of Wild Bunch’s library and is meant to enable Wild Bunch AG to repay its debt to Orange Studio, which is dedicated to co-producing and acquiring French and European films.
Contacted by Variety, Wild Bunch declined to comment on the deal. It comes as the company, which was behind this year’s Palme d’Or winner “I, Daniel Blake,” prepares to release its results for the 2015-16 financial year ending March 31. Wild Bunch’s numbers for the first half of the financial year showed a net debt of 84 million euros.
The debt to Orange Studio stems from movies that were either co-acquired with Wild Bunch for French distribution or for international sales, for which Wild Bunch failed to pay minimum guarantees. Although details on film titles that are part of the partial library sale were not available, Wild Bunch’s wide-ranging catalogue includes such movies as Arnaud Desplechin’s “Jimmy P,” Michel Hazanavicius’s “The Search,” Gregg Araki’s “White Bird” and Laurent Tirard’s “Little Nicholas.” These titles were co-acquired with Orange Studio.
Wild Bunch AG’s library is valued at 140 million euros, Wild Bunch’s co-founder and CEO Vincent Grimond told Variety at Cannes in May. Grimond added that it puts the global value of these library rights at an estimated 175 million euros on its balance sheet.
Addressing the company’s net debt, Grimond told Variety there was “no risk” based on Wild Bunch AG’s balance sheet because the company “sits on 175 million euros in assets”.
Since completing its merger with Germany’s Senator in February 2015 and forming the listed holding company Wild Bunch AG, the company’s share price has fallen 74% from 2.63 euros in 2015 to 0.68 euros as of Friday.
On March 27, 2015, Wild Bunch finished paying the remaining 8% bond which covered 2011 through 2016. But in a sign of some jitters over Wild Bunch’s finances, earlier this year the Banque Nationale de Paris nearly pulled out of the company’s banking pool (which also includes Neuflize OBC, among other institutions) but decided to continue backing the company, according to two separate sources with knowledge of the matter.
In spite of its financial challenges, Wild Bunch AG remains one of France’s most prestigious film companies because of its ability to attract critically acclaimed directors from across the world — from the Dardenne brothers to Cristian Mungiu, Ken Loach and Park Chan-wook.
The company’s biggest strength remains its international sales division, which is spearheaded by the outfit’s co-founder and CCO Vincent Maraval and Carole Baraton. Meanwhile, Wild Bunch’s weakest business stems from its French distribution activity, whose slate – headlined by French comedies — differs from its international sales roster and has been overshadowed by successive box office disappointments, notably “Asterix and Obelix: God Save Britannia” and most recently David Charhon’s “Shipwrecked.” Wild Bunch’s releases’ theatrical admissions tumbled to 3.8 million last year. Founded in 2006, Wild Bunch Distribution has ranked 6th to 10th among indie French distributors over the last decade.
In Cannes, Grimond told Variety that Wild Bunch was working alongside its partners on a “balance reshaping plan” in four steps consisting of injecting more equity, refinancing its bond, setting up acquisiton and financing for 2016 and 2017 divided in two packages – one for France and the rest of Europe — and lastly working on a joint package including global refinancing and market operation. Wild Bunch is said to have found the right partner to sign this joint package.
Under the leadership of Grimond, Brahim Chioua (COO), Markus Maximilian Sturm (CFO) and Maraval, Wild Bunch operates in France, Germany, Italy and Spain.
Since completing its merger with Senator Entertainment, Wild Bunch AG announced the launch, in partnership with CineFrance, of an LA-based company Insiders which is presided over by Maraval and focuses on the trading of independent films with budgets above $15 million, such as Jeff Nichols’s Cannes-competing “Loving” and Natalie Portman’s Kennedy biopic “Jackie.” China’s Bliss Media has just taken a share in the company. The company has also bowed a TV division dedicated to high-end drama and an e-cinema service.
John Hopewell contributed to this report.