German execs recall 'rough ride'
EmptyComplete Berlinale coverage
BERLIN -- The phone line to the former German distribution heavyweight Helkon Media rang dead as a doornail. The publicist at rival shop Senator had never heard of Hanno Huth. But then why should she? The long-term owner of the Berlin-based film company had long left behind the world of celluloid. And he's not the only one.
Like many of the former giants of the German film business who were buoyed to new heights by listings on the erstwhile Neuer Markt stock exchange in the mid- to late 1990s, Huth has since moved on to greener pastures.
Last seen at an underground party in Frankfurt and spotted before that clutching a priceless art work on a plane from London, Huth is now more likely to show up at a vernissage than a festival. You've guessed it, he's now dealing in art.
Several other former film bigwigs have been equally as adventurous since their film and television ventures went south when the market collapsed.
"Everyone was throwing too much money around, and the German media analysts didn't have a clue what they were doing," said Senator Entertainment president Carsten Lorenz, who was responsible for Senator's U.S. operations under Huth. "Once they got some analysts who knew what they were doing, the whole thing fell apart."
The founder of kidvid giants EM.TV, Thomas Haffa, is now rumored to be selling boats in the south of France; Helkon's co-founder, Martin Heldman, has reportedly moved into real estate; and Intertainment's Barry Baeres, he of "Battleship Earth" fame and the protracted legal battle with former Franchise head Elie Samaha, is said to have abandoned the tropical island he brought at the height of his success to raise a family in Zurich.
"Media companies had a really rough ride after 2002," former Helkon executive Patrick Martin said. "Most of the original business models from those companies were based on bank financing right down to the office furniture. It was really hard to maintain those businesses. A lot of people had such a tough time they preferred to walk away."
Martin, who now runs equity investment firm European Media Finance, has kept his hand in the entertainment business through a stake in European music broadcaster Deluxe Music. He is at this year's Berlinale looking for new business opportunities and rubbing shoulders with a number of his former colleagues who managed to stay in the game.
"It's a different time. What we did in the '90s you couldn't do now," he said. "But I'm always looking for interesting deals."
Another comeback kid is Andreas Klein of Splendid Medien, who also is at Berlin.
"What we did is to stick with it," said Klein, who is focused on the DVD business. "We managed to survive and stay clean. But there is no Oscar for doing that. For investors in those media companies that went bankrupt, the banks, nobody wanted to deal with the media sector anymore."
That's something that former Kinowelt executive Alexander van Dulmen knows only too well. When he came to launch his current outfit, A Company, in 2002, it was a tough time for any business. More so, he said, for a business dealing in all things Eastern Europe.
"The Neuer Markt was an exciting time," said van Dulmen, who is in Berlin meeting with business partners. "But it was also a time of wasted opportunities. Nobody understood that you didn't get a second chance. It was really hard launching a business after that time."
Kinowelt, which is releasing this year's Berlinale opener, Martin Scorsese's "Shine a Light," recently sold the bulk of the distribution giant to Paris-based Canal Plus for €70 million. Founders Michael and Rainer Kolmel enjoyed a moment in the spotlight at the Thursday night premiere when the film and crew received a standing ovation. Some say it was well deserved.
"There are a few people I respect for having made it through," van Dulmen. "You have to count the Kolmels amongst that number."
"It's funny, in all the companies management has either been replaced or has left to do other things," Michael Kolmel said. "Andreas (Klein) and my brother and I are the only ones still here."
Several years have passed since a wave of bankruptcies swept through the industry here after these companies collapsed, and executives in the know finally have begun to open up about what really went on behind the scenes in those heady days.
"One American company had a so-called Russian model, Nadia, who supposedly didn't speak a word of English or German, and who would sit at the table and spy on all the Germans when the Americans went to the restroom," Lorenz said. "It was so 'Mata Hari.' "
There also were reports of deals that were announced but never concluded, companies that were never really acquired but whose figures were nonetheless included in the annual returns of the firm that never brought them in the first place, and horror stories of promised financing drying up in the middle of production.
"I need a T-shirt saying, 'I survived the Neuer Markt,' " said Myriad Pictures president Kirk D'Amico, who recalls being left high and dry in 2001 with three films in midproduction, including the Jennifer Aniston starrer "The Good Girl."
"A lot of innocent people who got caught up in the middle of that mess, not least the mom and pops, the private individuals, who invested the money in the first place," he said.
Some people even spent time in jail. These include Michael Kolmel and VIP Medien's Andreas Schmidt, who, after several years inside, is attending Berlin while he awaits sentencing for allegedly breaking the law through the controversial structuring of his tax-backed film fund.
Other players had a little more luck. These include Herbert Kloiber of the Tele-Muenchen Group, which never went public but made money out of everyone else's foolish forays on the stock exchange when he bought and sold a portion of his company for a huge profit in the wake of the EM.TV demise; and Joe Drake, who bought into Senator just as things started to turn around. That company later morphed into Mandate and then Lionsgate Films.
"It was like a big party we all attended and had a great time at," Martin said. "Then came the big headache afterwards. It was one big bubble."