Spanish film finance case studies

Funding changes impact diverse projects

By EMILIANO DE PABLOS

'Suso's Tower'

MADRID -- In the second of an occasional series, Variety delivers four case studies illustrating trends in Spanish film finance.

The broadcaster studio: Steven Soderbergh's Che pics

Steven Soderbergh's Cannes Competition player, the two-pic Che Guevara bio, underscores the lead now being taken by Spanish broadcast networks in international film production.

Starring Benicio Del Toro, "The Argentine" and "Guerrilla" also reflect the pivotal role played by the Paris-based sales agent Wild Bunch in bankrolling highly ambitious auteur fare involving Spain.

Che has history. It was originally set up with Terrence Malick, who dropped out in 2003. With Soderbergh attached, U.S. producer Laura Bickford, Wild Bunch and Spanish production house Morena Films relaunched financing, budgeted at $61.5 million, not counting deferrals.

One key step was enlisting Telecinco Cinema, film division of TV web Telecinco. TC and Morena took a 25% co-production stake, with TC retaining all Spanish rights and both a cut of international.

Telecinco was only too happy to team with Wild Bunch. The Paris company had successfully sold the Telecinco-backed megahit "The Orphanage" and Guillermo del Toro's "Pan's Labyrinth." Morena had co-produced with Telecinco, including recent comedy "Salir pitando," also partnering with Sony.

"Che's one of the bigger-budget film projects ever made in Spain. It would have been impossible to co-produce it out of Spain without Telecinco. No independent producer could shoulder this huge level of investment," says Morena's Alvaro Longoria.

A nine-week shoot took place in Madrid, Castille La Mancha and Andalusia. Cast and crew include Spanish thesps Jordi Molla and Oscar Jaenada, as well as Oscar-nominated composer Alberto Iglesias.

Also shot in Puerto Rico, pic drew a 40% rebate on $15 million spend.

Wild Bunch and Telecinco/Morena put up 75% and 25%, respectively, of Che's complex financial structure.

Though Wild Bunch wasn't looking to presell Che widely, according to Wild Bunch's Vincent Maraval, many territories have already been taken including France (Warner Bros.), the U.K. (Optimum), Scandinavia (Scanbox) and Italy (Bim Distribuzione). Sun Distribution Co. took Latin America. U.S. rights are still up in the air.

Ciudad de los Rebates: "Asterix at the Olympic Games"

Frederic Forestier and Thomas Langmann's "Asterix at the Olympic Games," one of the most expensive European films ever made, was almost entirely shot at Alicante's Ciudad de la Luz studios.

Budgeted at x78 million ($124.6 million), the Gallic adventure comedy was co-produced by France's Pathe Renn, La Petite Reine and TF1 Films (60%), Germany's Constantin Film (20%), Spain's Tripictures and Sorolla Films (10%) and Italy's Novo RPI (10%).

Filming began in June 2006 for a few days in the Fontainebleau forest near Paris before rapidly transferring to Ciudad de la Luz, where an Olympic stadium set had been built. Shoot remained there through November.

"Production had three main parts: above-the-line, the Ciudad de la Luz shoot and post-production in France. Post-production took a large part of the budget," Tripictures VP Jose Hueva says.

Post-production lasted from December 2006 to October 2007. Visual effects, an essential factor, were divided among France's E.S.T., Dubois and Microsimage.

Tripictures, a top Spanish indie distrib, had disseminated the first two "Asterix" movies. Against its minority stake in "Olympic Games," Tripictures retains in perpetuity Spanish rights and a slice of foreign. Bowing February in Spain, pic garnered near $9 million vs. "Asterix 2's" $10.4 million.

Pic didn't hit targets in France, but did sell to 60 countries. In Alicante, it generated around $48 million in production spend.

Films shot at Ciudad de la Luz Studio benefit from 12%-20% rebates on Valencia region spend.

Nurturing new talent: "Suso's Tower"

Spanish production giant Mediapro has two film production lines: high-profile international auteurs, Spanish and foreign -- such as Woody Allen -- and new local talent projects, such "Suso's Tower."

Helmed by Asturian first-timer Tom Fernandez, the rural dramedy is a 100% Mediapro production.

Pic has a typical financial structure for a Spanish midbudget pic, underscoring the increasing importance of regional coin.

"There's no mystery to the financing," says Mediapro head of film Javier Mendez: "Suso's Tower" sports a $3.8 million budget, including P&A. Nationwide pubcaster TVE and Catalan regional pubcaster TV3 took free-to-air rights, repping around 25%-30% of total budget.

Fernandez set the story of "Suso's Tower" in Asturias' lush landscapes, so Mediapro decided to lense there as well. Shooting in Asturias added 30% to production costs, but the regional government contributed with 10% of pic's budget.

"Tower" will access ICAA Film Institute subsidies tabbed at 15% of Spanish B.O. and a second subsidy capped at $960,000 and calculated at 33% of Spanish producer investment, since "Tower's" receipts -- a successful $2.5 million -- easily passed a B.O. benchmark of $528,000, which triggers this aid.

Mediapro estimates another 10% of budget return from international distribution, with French sales agent TF1 Intl. handling international rights. Remaining finance came from Mediapro's pockets.

"We've learned to live without selling pay TV rights in Spain," Mendez says.

The Latin-American connection: Lisandro Alonso's "Liverpool"

Argentine auteur Lisandro Alonso's drama "Liverpool," which world preems in Cannes' Directors' Fortnight, is an example of a pic from an emerging film nation supported by Euro funds and producers.

A leading light of Argentina's hallmark docu-style minimalism, Alonso filmed "Liverpool" during four weeks of the harsh Austral winter in Ushuaia, with a 12-person tech team and nonprofessional actors.

The "Liverpool" project, with a $958,160 budget, was produced by Alonso's label 4L with Spain's Eddie Saeta, France's Slot Machine, Holland's Fortuna Films and Germany's Black Forest.

Each partner contributed 20% equity to the co-production, retaining film rights for its own territory. Fortuna brought money from the Rotterdam Festival's Hubert Bals Fund, Black Forest from the Berlin fest's World Cinema Fund. 4L also drew down subsidy aid from Argentine film institute Incaa.

"The French and Spanish partners have put up their own money," says Eddie Saeta's founder, producer Luis Minarro.

The Spanish-Argentine co-production axis opened up aid for Eddie Saeta from the Ibermedia fund, which reps less than 20% of its investment.

Cologne-based sales agent the Match Factory put up an undisclosed minimum guarantee.

Pascual Condito's Primer Plano took Argentine rights on "Liverpool," but Eddie Saeta has yet to sell Spanish TV and distribution rights.

"I came into this project because it was an opportunity to introduce Spain to Lisandro Alonso, one of the most talented of Argentine filmmakers alongside Lucrecia Martel. But if I don't sell Spanish rights, I will suffer a loss on the investment," Minarro explains.