Germany's Senator Entertainment Issues $13 Million Bond

1:37 AM PST 06/20/2014 by Scott Roxborough
FilmNation
Senator co-produced Anton Corbijn's "A Most Wanted Man," starring the late Philip Seymour Hoffman.

The troubled producer-distributor hopes to raise sufficient capital to keep it afloat as it restructures.

Senator Entertainment has issued a short-term bond with a volume of up to $13.6 million (€10 million), capital the troubled German producer-distributor needs to maintain operations as it restructures.

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The nine-month bond, which Senator has offered to institutional investors, is aimed at keeping the lights on while the Berlin-based company overhauls its business to focus more on in-house production and less on costly acquisitions.

Assuming the bond is quickly subscribed, Senator plans to initially draw down half, around $6.8 million (€5 million), to bankroll current operations in the transition period.

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That transition will see British investment group Sapinda take majority control of Senator and attempt to reposition the group. Last month, Senator CEO Helge Sasse resigned after eight years at the helm, taking responsibility for the company's problems.

Senator had a horrible 2013, as numerous costly theatrical acquisitions, including David O. Russell's Silver Linings Playbook, Steven Soderbergh's Side Effects and Paul Thomas Anderson's The Master, fizzled at the German box office. Last year, the company booked a net loss of $38 million (€27.4 million) as revenues fell 47.1 percent to $37.5 million (€27.1 million). Part of that was due to a massive $15 million (€10.8 million) write-down on film assets in preparation for Sapinda's buyout.

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Following the restructuring, Senator plans to focus more on in-house and co-productions, both German-language features and international co-productions such as Anton Corbijn's A Most Wanted Man, starring the late Philip Seymour Hoffman, which Senator co-financed.

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