Film fund VIP pacts with Brass Hat
Duo have $190 mil production kitty
The two companies say they have the combined resources to bankroll $190 million of production, both in the U.S. and in Europe.
Typically they will provide equity covering 20% of that figure, and lay off the rest of funding through distribution deals or other forms of trade financing.
They are also starting their own foreign sales operation, headed by Glenn Kendrick Ackerman, to handle the rights for all upcoming productions that don't have sales agents attached.
Brass Hat, which has co-financed 16 movies with total budgets of $380 million over the past three years, including "Premonition" and "Shopgirl," will take the lead in identifying projects and negotiating with producers.
The partnership is the latest move by VIP to rebuild its business and reputation, following the criminal prosecution for fraud of its previous management, and the changes in German tax rules to clamp down on film funds.
For the past year, VIP has been under new management, headed by m.d. Dirk Specht, with no connection the old team.
With VIP's investors unable to withdraw their money from the fund until 2014, Specht's task is to keep finding movies to back that will give them the best possible return, even without the benefit of a tax break.
Brass Hat has always pursued a pure equity investment strategy that did not rely on tax breaks, so VIP is hoping to tap this expertise and Brass Hat's contacts among the Hollywood production community.
Specht commented, "After some turbulent times for German funds and in particular also for VIP, we are looking forward to achieving the best possible opportunities for our investors. The partnership with Brass Hat gives us the opportunity to strengthen VIP's position in the international film production market."
He also admitted that he hoped the alliance would help to solve VIP's "image problem," particularly in Los Angeles.
Brass Hat typically puts up 30% of budgets against North American rights, with a studio handling the distribution for a fee. Recent projects include "Death Sentence," "Dreamer," "The Persuaders" and "The Other End of the Line."
Brass Hat chief exec Lars Sylvest said he believes that "the increasing hesitation of U.S. hedge funds provides a perfect entry point for single picture financers such as VIP and Brass Hat."
VIP, founded in 2002, has financed more than 50 films budgeted at over $1 billion, including "Monster," "Perfume" and "Lord of War." It is already working together with "Brass Hat" on Marco Kreuzpaintner's sex-trafficking drama "Trade."
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