Tuesday, 28 March 2017
Last updated 17 hours ago
May 25 2016 | 7:36pm ET
Specialty finance company Versa Media Capital, which provides production loan financing to creators of independent film and TV content, has secured a $100 million facility from alternative asset manager Crayhill Capital Management.
In addition to traditional subordinated production loans (e.g., mezzanine, gap and tax credit loans), Versa will be the first institutional lender in the industry that specializes in bridge financing, according to the company. Bridge financing can provide timely capital for critical production costs prior to the senior bank or full production financial closing, including down‐payments for talent, pre‐production costs and other early production expenses, Versa said.
Demand for new independent film and TV content is growing rapidly as both traditional and non-traditional distribution channels, such as over-the-top streaming and other video on demand applications, become more popular. Accordingly, demand for institutional capital in support of producers has similarly grown. Versa expects to finance approximately 15 to 20 projects per year, it said.
The Versa team has a long and successful track record in production, structured finance, international treaty co-productions, and international distribution, having funded and arranged over 100 loans and other financings in the past two decades for productions with budget sizes from $2 million to over $40 million.
“Versa Media Capital intends to become the go-to source of capital and expertise for independent film and TV content creators, and will provide the elements needed to put projects on the solid footing required to complete a permanent financing package,” said Geoffray in a statement. “In addition to capital, our support will include financial, legal and production expertise.”
“We see this as an exciting opportunity to extend Crayhill’s asset-based media investments in a rapidly expanding market not met by traditional lenders," added Josh Eaton of Crayhill Capital Management in the statement. “The accelerating growth in digital and other non-traditional distribution channels, coupled with increasing demand from non-U.S. markets, is driving demand for new film content and creating attractive collateralized lending opportunities."
Los Angeles-based Versa was founded by former Blue Rider Finance co-founder Jeff Geoffray, entertainment attorney Jeffrey Konvitz, and private equity investor Daniel Rainey earlier this year.
New York-based Crayhilll Capital Management, meanwhile, has an extensive history of financing major motion pictures. Founded in August 2015 by Eaton, former Magnetar Capital executive Carlos Mendez, and former Strategos partner Fred Horton, Crayhill is a specialist in illiquid credit and asset-based opportunities that takes a hybrid hedge fund/private equity approach to investing. It has more than $900 million in assets under management.