Macquarie places Oz pic plans on hold
Rift with FFC triggers delay until 1st quarter of 2001
Macquarie, one of two film license investment companies established by the government to raise private capital, had planned to announce three projects by year's end.
But a rift with Oz's main government film funding body, the Film Finance Corp., is among the reasons for putting plans on hold until the first quarter of 2001.
The FFC and Macquarie had agreed to work together, but now the FFC is claiming Macquarie has scuttled that arrangement by inking a theatrical alliance with UIP in October.
Macquarie CEO Bryan Lowe says at least one of the expected projects "may have involved FFC financing."
The FFC sought equal recoupment in its co-financing deal with Macquarie but allows domestic distributors preferential recoupment in return for bankrolling marketing.
According to the FFC, Macquarie sought preferential recoupment through its alliance with UIP and had agreed to fund P&A, traditionally the distrib's responsibility, in FFC agreements.
The FFC viewed the alliance, about which it was not consulted, as giving Macquarie an unfair advantage while eliminating UIP's net risk.
FFC chief Catriona Hughes said, "In our opinion that's not pro-rata investment, and we'd be disinclined to participate."
Lowe concurred, saying, "It is somewhat less likely that we will co-invest ... but we maintain an open dialogue to look at projects with the FFC."
UIP's Oz managing director Mike Selwyn defended Macquarie's right to preferential recoupment. "They're actually putting extra risk into the film, and it's only that extra risk they're looking to recover first. Their position as producers with the FFC would have remained absolutely equal, so I have to admit I'm at a loss to understand the problem."
Lowe says Macquarie, which has evaluated over 300 proposals since launching in May 1999, is seeking the best possible recoupment from each project on a case-by-case basis.
