CL takes CAA's advice
CAA will provide advice to CL on its global entertainment portfolio, which includes 98.5% ownership of MGM and investment in other troubled indie players such as Carolco Pictures, Epic Pictures and NSB Corp., formerly Hemdale Film Corp. Several of those companies are currently embroiled in legal battles with the French lender, accusing it of improper banking practices (see related story, page 1).
MGM co-chairman/CEO Alan Ladd Jr. neatly summarized the logic behind the bank's savvy stratagem with a double-barreled plaudit: "At CAA, they do know who the players are and who is reputable and who is a good risk."
CAA's stalwart reputation will undoubtedly improve the bank's image in Hollywood.
A CAA spokeswoman has begun the campaign by denying the bank's image actually needs changing.
"This is a 130-year-old financial institution and one of the most respected in the world," she said.
However, the agent did say, "It's true that some of the bank's activities have been troubled. If that was not true they probably wouldn't have approached CAA."
CAA is optimistic about its role in the bank's future decisions: "We think we can be enormously helpful in an advisory capacity," the agent said.
In a statement, CAA chairman Mike Ovitz said: "We look forward to working productively with the bank as it implements its entertainment plans and strategies."
In the same statement, CL managing director Francois Gille said: "We look forward to receiving their advice and counsel on all aspects of our global entertainment industry activities. We also believe our relationship with CAA will enhance our ability to expand our presence and explore future opportunities in this industry."
Asked if the bank chose CAA over rival agency Intl. Creative Management because former CL official Frans J. Afman is now an ICM agent, a spokesman for the bank said, "That has nothing to do it."
Asked about the timing and the fact that the announcement was made the same day Credit Lyonnais was slapped with a Hemdale lawsuit, the CL spokesman insisted: "It is totally coincidence."
The bank said the reason it hired CAA is progress. "I think the bank feels ... that a corner has been turned in terms of its business activities in the entertainment industry. Its clients -- from an operating point of view -- have established sound platforms for production and distribution at the same time that the bank is progressing with litigation in a number of situations. In view of this progress, the bank feels it is appropriate to have the benefit of the kind of counsel that Michael Ovitz and CAA can provide as it moves forward with its agenda," said the spokesman.
CAA's influential position with A-list talent would appear to be another source of motivation for the bank's move. However, both the bank and CAA, as well as MGM, say CAA's access to talent has nothing to do with it.
"Not at all," according to Ladd. "They (CAA) do business with everybody in town." And "the bank feels its clients can compete -- and win -- with any other company in town for talent and projects," per the CL spokesman.
The bottom line, according to the CAA agent, is that the bank will make its own decisions and "CAA will be an adviser on current and future projects on a broad range of issues. It's an exciting chapter, though. It will be very exciting."
