Finmavi to go public
Italy's Cecchi Gori to list film, TV holding
"I have grown up in a family company and I have always been skeptical about going public," Cecchi Gori told the paper in an interview.
"However, my advisors convinced me that my concerns are groundless and the stock market offers, instead, the opportunity to develop our group and business," he said.
Cecchi Gori's control
The control of Finmavi will remain in Cecchi Gori's hands, the tycoon said. Cecchi Gori's financial counselor, Guido Rossi, and advisor banks, Banca di Roma and Monte dei Paschi, are studying the operation; they plan to sell on the market about 30% of the media group, probably in 1999.
In the meantime, U.S. merchant bank Allen & Co is looking for international partners to join the Cecchi Gori group, the report said.
The Italian producer will spend his Christmas holidays in the United States to meet possible partners, particularly in the digital pay TV sector, where Cecchi Gori is planning to operate soon.
In November, Cecchi Gori reorganized his media business, unifying his beleaguered television division with his successful film business, and writing off most of the TV unit's debt.
The operation said that Finmavi, the private holding that controlled all the film production and distribution activities of the Florence-based group, absorbed Cecchi Gori Media, which owned national terrestrial channels TMC and TMC2.
New Finmavi
The new Finmavi, which has 850 employees, does not include Cecchi Gori's film exhibition activities, real estate proprieties or soccer team, Fiorentina.
At the same time, the $143 million debt due by CGM to Finmavi for the acquisition of TV rights was written off, allowing the TV division to post a 1998 financial loss limited to $54 million, compared with the $106 million loss in 1997.
According to Il Sole 24 Ore, Finmavi will close this year with a $12 million net profit and revenues of about $343 million, because the profits of the film division will compensate for the loss of the TV activities and the debt write-off.
"The financial and patrimonial structure of the group is sound and healthy," Cecchi Gori said. "Its library includes over 3,000 films, 1,000 more than last year, 300 of which have not been released yet. In the last three years we invested over $625 million in film acquisition and production, and we largely remain Italy's leading company in the film and homevideo market."
Positive results
According to the media mogul, the financial exposure of his group is limited to $312 million on the long-term and $93 million on the short-term.
"We expect good results in both the film and TV divisions.
"TV channels TMC and TMC2 should reach break-even in 1999 or in 2000, because my wife and I are personally running this division now," he said.
Three and half years ago, when Cecchi Gori bought the two webs, he claimed that his TV group would have put an end to the long-existing TV duopoly of pubcaster RAI and Silvio Berlusconi's Mediaset. However, the two channels continued to have a minuscule audience share (less than 3% in 1998), accumulating financial losses.
To launch his network, Vittorio Cecchi Gori changed its top management more than once. Last year former managing director Francesco Nespega was forced to leave the group, and is currently involved in a legal battle with the film producer.
In October, Brando Giordani, the head of programming for Cecchi Gori's TV network, left the company. According to industry insiders, TMC president Biagio Agnes is expected to step down shortly.
In the meantime, Vittorio Cecchi Gori's wife and partner, Rita Rusic, has recently taken over the artistic direction of TMC 2 and is now expected to extend her role in the network.
