Montreal: William F. White International’s Quebec affiliate Groupe Moliflex-White has applied to Quebec Superior Court for bankruptcy protection from creditors owed $23.4 million. WFW is also the largest unsecured trade payable, owed close to $5.8 million.

The National Bank of Canada, registered with a Toronto branch, is the sole secured creditor, and is owed $13.2 million, according to trustee PricewaterhouseCoopers.

Paul Bronfman, WFW chairman and CEO, says Moliflex-White is working closely with the bank. ‘We don’t want anybody to get burned, but in a situation like this people are going to get hurt,’ he says.

Bronfman says the company tried hard to compete in the Montreal market but found it impossible.

PwC has been mandated to find a buyer for the Cine Cite Montreal studio and other assets, not including camera equipment, in order to pay off the bank.

Bronfman adds that WFW will cease all Montreal operations, except for a specialized camera equipment company.

Moliflex-White operations in Montreal include Cine Cite and two additional studios, Icestorm Studios and Les Studios LaSalles, the latter of which is co-owned with Technicolor Worldwide Film Group, and the production service company Les Productions Luc Dussault, which is protected from the bankruptcy proceedings.

The overall investment in Cine Cite, the 75,000-square-foot soundstage facility in suburban St. Hubert launched in 1999, is estimated to be in the $15-million range.

Among the financial losers in Moliflex-White’s bankruptcy is equity partner Societe generale de financement, a Quebec government investment arm, which has invested $6 million since ’99, when it took a 40% share of the limited partnership. The balance of shares in Moliflex-White are held by WFW and three Quebec partners. SGF also made an additional, non-secured loan to the company of $500,000.

Fonds d’investissement de la culture et des communications, a risk capital fund set up by union-based Fonds FTQ and SODEC, has invested approximately $1 million.

Other creditors include Developpement Economique Canada, Onset of Vancouver, Studio Lasalle, SODEC, ARRI Canada and close to 400 other companies owed a total of more than $2.5 million.

The APFTQ producers association issued a press release expressing serious concern at the prospects of a non-competitive offer in the local equipment and studio sector, and the potential for what it calls a ‘quasi-monopoly.’

Technically, WFW will remain in the Montreal market through its Cinequip-White sales arm, although Bronfman describes Cinequip as an outside service exclusive to special clients. Moliflex-White continues to operate under receivership and all of its studio operations continue to do business, but on a largely reduced basis.

Bronfman, who is also chairman and CEO of Toronto-based Comweb Group, says, ‘This is new for me. I’ve never been through anything like this or a receivership before.’ He says he is very discouraged with the development. ‘We failed to do in Montreal what we thought we could do.’

Bronfman has been active in Montreal since 1992 when he launched a partnership with Emmanuel Lepine, whom Bronfman says ‘has no wish to return to the industry. That’s a huge loss to the city’s production community, and to us.’

In press reports, Cine Cite competitor Mel Hoppenheim, president of Mel’s Cite du Cinema, the city’s largest soundstage facility (with 152,000 square feet and 13 studios), said he regrets Moliflex-White’s bankruptcy, but added that Cine Cite’s problem was ‘location, location, location,’ a reference to its suburban location at the former St. Hubert military airbase, about 25 minutes from downtown Montreal.

Bronfman refutes the claim. ‘I don’t want to get into ‘he said, she said,’ but that’s laughable. We never had a problem [after the first two years] in Vancouver with the North Shore Studio, which is 20 minutes to half an hour from downtown,’ he says.

Bronfman also hopes Cine Cite will find a buyer and not close its doors.

A spokesperson for Moliflex-White says the studio’s financial problems had been exacerbated by cutbacks to the Canadian Television Fund.