Corporate changes shake film biz

The Canadian distribution business in 2008 was pretty much the mirror of 2007. As of Nov. 20 (week 47), total box office stood at $808.9 million, on track to match last year’s total of $857.6 million. But on a corporate level, much has changed.

In January, Quebec’s provincial investment agency Société générale de financement purchased a $100-million controlling interest in Alliance Films from EdgeStone Capital Partners. While Alliance officially moved its head office to Montreal, chairman Victor Loewy has stayed put in Toronto. That same month, its main competitor, Entertainment One (where Loewy’s former lieutenant Patrice Théroux is president of filmed entertainment), purchased the Benelux distribution company RCV, establishing its third beachhead outside of Canada.

In February, Time Warner announced the retrenchment of New Line Cinema into the corporate fold, scaring the wits out of Alliance. In March, E1 continued its expansive ways, signing an output deal with ThinkFilm and acquiring the company’s Canadian library rights.

In April, Miramax ended its 14-year relationship with Alliance by self-releasing Smart People in Canada through its parent company Walt Disney. Loewy downplayed the end of the affair, saying Miramax was asking too much for too little. That same month, ThinkFilm president Jeff Sackman resigned from the company he founded, a year after its acquisition by Los Angeles-based film financier David Bergstein.

In May, an over-stretched Christal Films sought bankruptcy protection after parting ways with partners Lionsgate and Maple Pictures, leaving $12 million owing to 260 creditors.

In July, E1 again made waves, acquiring Robert Lantos’ fledgling releasing company Maximum Films, along with production companies Barna-Alper Productions and Blueprint Entertainment and sales company Oasis International.

In September, just before the Toronto International Film Festival, Alliance bounced back with news that New Line had renewed its output deal into 2009. It also confirmed output arrangements with Relativity Media, Grosvenor Park and Freestyle Releasing.

Later that month, Maple stepped forward with news that former Alliance executive Jim Sherry had negotiated an output deal with Miramax and was rewarded with the position of co-president at the company.

Meanwhile, E1 repatriated itself through a reverse takeover deal with Halifax production company DHX Media – once finalized, the deal will give E1 a listing on the TSX – then, in October, rebranded its network of companies under the E1 Canada banner.

While the overall box office was steady, Canadian films were down. Last year, Canadian films grossed a total of $27.8 million. As of Nov. 20, 2008, the total was $22.5 million; there’s little chance of adding an extra $5 million before year’s end. Market share barely changed, down slightly from 3.2% to 3%. Still, English Canada got its biggest hit since Men with Brooms (putting aside the solitude-bridging Bon Cop, Bad Cop). Released Oct. 17, Paul Gross’ Passchendaele had earned more than $4.3 million as of Nov. 27.

But the biggest box-office story of the year was not Passchendaele but another Rhombus’ production, Blindness. Although the First World War epic will win the Golden Reel, its prospects beyond Canada are slight. Blindness performed modestly at home – given its pedigree and marketing push – earning close to $726,000. But look abroad: in its other homes. The Canada/Brazil/Japan coproduction opened in Brazil in September and has since taken in US$4 million. It opened in Japan in November and has earned almost US$1 million; in Korea, over US$1 million. To date, the film has grossed close to $14 million worldwide.