VCL snaps up German film fund
EmptyBERLIN -- Datty Ruth's VCL Film + Medien has acquired Equity Pictures, the German film fund that backed such pictures as "16 Blocks," "The Black Dahlia," "The Wicker Man" and "The Matador."
VCL's subsidiary, Allied Film Management, will take an 85% stake in Equity, with the remaining 15% being incorporated into VCL via a capital increase of €812,500 ($1 million) in new shares.
VCL said the price tag for Equity was in the "upper single digit millions of Euros" and that the deal will be largely financed through a loan from a hedge fund.
With the deal, VCL adds the often tricky business of film-fund management to its core profile of licensing and distributing home entertainment titles in Germany.
Equity is one of Germany's largest tax-shelter film funds, all of which have been banned under a new financing law. The company helped bankroll and holds certain rights to films with a production volume of about $400 million.
The bulk of these were produced with Avi Lerner's Nu Image/Millennium Films. Titles yet to be released include "Homeland Security," starring Antonio Banderas and Meg Ryan, Tim Hunter's cop thriller "New Orleans," with Robert De Niro and 50 Cent, and Sylvester Stallone's in-development "Rambo IV: The Pearl of the Cobra."
But Equity has recently been targeted by German tax authorities, who earlier this year searched the company's Munich offices looking for evidence of investor fraud (HR 12/9). So far, no charges have been brought.
That didn't seem to worry traders, who snapped up VCL stock on news of the deal. VCL shares jumped 50% to €1.36 ($1.79) in afternoon trading Thursday.