Montreal producer to enter financing: Blackwatch going public
Toronto: September 9, 2000: As it gets set to become a publicly traded company, Blackwatch Communications Inc. said yesterday it is creating a new subsidiary that will provide financing to film producers. Bill Mariani, founder and president of the Montreal-based film production and distribution company, said over the next eight months it will introduce three types of film financing ญญ from bridge financing to full financing for movies deemed commercially viable ญญ with capital totalling $50 million.
About $10-million of this money will come from a public offering the company plans to make later this fall, raising as much as $15-million. The creation of Blackwatch Financial Inc. will be a "unique and much-needed" source of financing for production, Mr. Mariani said, especially given the "conservative" attitudes of Canadian chartered banks when it comes to loaning money for films.
As well, he said, because Blackwatch offers a full range of production, releasing and other administrative services, it can "do deals that no Canadian bank could even consider." "The concept is one-stop shopping," he said.
"We will offer what producers need -- cash flow, tax credit systems, tax credit analysis and collection, legal and accounting services, post-production and delivery services." Mr. Mariani founded Blackwatch Communications in 1995. Blackwatch entered the film distribution business in May, 1999. One of its hottest releases was Pedro Almodovar's All About My Mother, which won the Oscar for best foreign film in 1999 and is one of the top-grossing foreign films in Canada.
He said the new financing subsidiary could eventually make up 25% of the company's revenues, becoming a "very important part of Blackwatch." Starting in November, Blackwatch Financial will offer bridge financing, designed to help producers solve short-term cash flow problems.
Blackwatch will lend money to producers who need short-term cash before they can draw down from a bank loan or receive government tax credits or certificates. For example, if a producer's bank closing is delayed beyond the date required for pre-production of the film to begin, Blackwatch Financial can step in and bridge the production for 90 days or until closing.
In March, Blackwatch Financial intends to offer "gap" financing to producers who do not have enough money to complete a production. Finally, in June, Blackwatch Financial will offer financing for films with firm distribution deals.
Yesterday's announcement comes on the heels of news that, through a reverse takeover of Montreal-based Wotan Capital (which trades on the Canadian Venture Exchange), Blackwatch will become a publicly traded company within the next two months, subject to regulatory approval and due diligence.
Black & White Photo: Kevin Van Paassen, National Post / Bill Mariani, founder of Blackwatch Communications, seen yesterday in Toronto.
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