An investment group headed by entertainment entrepreneur Gary Beer-co-founder and former CEO of the Sundance companies-has reached an agreement in principle to buy bicoastal/international Propaganda Films’ commercial, music video and talent management businesses from Universal Studios. Propaganda’s production house family encompasses Propaganda Films, bicoastal/international Satellite, the U.S. operation of Partizan Midi Minuit, and Propaganda Independent, a venture that has been successful in garnering commercials for select feature filmmakers.
Beer made the acquisition under the aegis of Propaganda Film Holdings, an enterprise he formed in association with the SCP Private Equity Partners investment fund and Austin-Texas-based cable pioneer Jack Crosby, former chairman of Imagine Entertainment.
The sale is expected to close within 30 days. Once it is finalized, Beer would become CEO of Propaganda Films. The purchase price was not disclosed. Beer declined to comment on reports that have pegged the transaction as being in the $10 million to $15 million range.
Beer is a 14-year veteran of Sundance. He managed the Sundance Film Festival in Park City, Utah, for several years dating back to its inception in ’84. And as chief executive of the Sundance group of companies, he oversaw such operations as cable’s Sundance Channel, the Sundance Cinema Circuit and the Sundance Catalog of apparel, artwork and merchandise. Beer left Sundance last July, linking with SCP and Crosby to explore industry investment opportunities.
Beer said he plans to be supportive of and to keep Propaganda’s commercial, music video and talent management teams intact. "The company has an extraordinary base of talent and management," assessed Beer. Key players on the spot front include Propaganda Commercials’ president Steve Dickstein, head of commercial development Dave Morrison and VP of Commercials Colin Hickson.
Beer characterized Propaganda as "a unique creative asset," adding that its "combination of talent management and multimedia production is a strong platform upon which to continue to build a talent representation company."
Beer affirmed that he’s committed to maintaining Propaganda’s multi-faceted involvement in assorted disciplines spanning short- to long-form. "The bottom line is that we will stay in the business of creating feature film opportunities for our directors," said Beer, "while maintaining our core business in commercials, videos and talent management." Exactly what form Propaganda’s linkage to the feature world will take is yet to be determined. Beer related that he was "looking at a number of different options" but said it was too early to publicly discuss specifics. "I need to have more time with management to get their input and to explore the best opportunities," he explained, adding that Propaganda will retain certain long-form projects and deal commitments that are currently in place for its roster of commercial and music video directors.
Whatever plans crystallize in long form under Beer, there’s also the likelihood that Propaganda chairman Steve Golin will continue as a prime conduit to the feature biz for Propaganda’s spot, video and talent management operations. He figures to remain involved in the Propaganda feature film assets that were acquired last week by USA Networks. Per that deal, media mogul and USA Network chieftain Barry Diller returned to the theatrical motion picture business when his company acquired from Universal parent Seagram Co. not only October Films but also certain Polygram Filmed Entertainment (PFE) entities, including Propaganda’s feature operation and slate. Diller plans to combine October and those PFE holdings to form USA Films which will be the feature division of USA Networks.
Beer said that Golin is currently in talks with Universal and USA Films. And the outcome of those discussions will help Beer and colleagues shape Propaganda’s blueprint for keeping significant ties to the feature arena.
Dickstein said that Beer’s goal is to make sure Propaganda’s spot, music video and talent management businesses "continue to flourish" while opening up diverse creative opportunities for its artists. Recent work out of Propaganda includes the Dante Ariola-directed Nike campaign-carrying the tagline "March Madness. It’s spreading"-for Wieden & Kennedy, Portland, Ore. Propaganda has also expanded its directorial roster in recent months, the latest addition being Charles Wittenmeier, formerly of A Band Apart Commercials, bicoastal and Minneapolis (SHOOT, 2/26, p. 1).
SCP Equity Partners, the Wayne, Pa.-based investment fund that’s teamed with Beer, is also bullish on Propaganda’s future prospects. A released statement from Win Churchill, managing general partner of SCP, read: "SCP’s investment in Propaganda represents an area of content investment for the fund, which complements our communications information technology and Internet holdings. SCP believes that Propaganda is a unique creative organization poised on the forefront of the convergence of entertainment and information businesses."
SCP is a $265 million private equity fund that’s affiliated with Safeguard Scientifics, Inc., which is traded on the New York Stock Exchange.
