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Agreed, this project is ready to go!!! This will be very attractive to financiers.
To me, it sounds like they have a few minor issues to work through. They have completed many of the procedural necessities. The fact that this is ready to go will only help in receiving financing. I think it is very realistic to expect financing to be finalized in July and construction of the studio to begin in August. I think there is still a good possibility the studio is up and running by EOY.
I am glad to see that they are spending money on paying down debt and construction services. Sounds like they are almost ready to commence construction on the studio. Now they just need the financing to fall into place which I am sure Koppelman is working on.
Maybe you should read up on Medient's business plan. Their plan is not to make movies with a-list stars. They stars cost too much money. They plan to make movies in the most profitable segments horror, sci-fi and action that do not rely on expensive stars. Their movies may not gross huge amounts of money but they will generate more than the cost to produce. This will result in high profit margins. The whole point of Medient is to do things differently than Hollywood is doing right now.
I love how focused the new management's plans are. One Georgia movie at a time and one building at a time. Concentrating on the best possible release of Yellow. Running a lean operation. This is what should have been done in the first place.
So much more shareholder value could have been preserved if Manu had just been realistic about what could have been accomplished. There was plenty of time to build this up and shareholders would have supported him. Manu should have taken it one step at a time. Anyway, I think this is about to turn around and longs will make good money but it could have been even more.
That movie was going to be very expensive to produce. I think the budget was stated as 12M in the variety article. Seems like a big risk given where Medient is at. Plus, I think Medient's goal is to film as much as possible in Georgia to utilize the tax credits. That will ensure profitability and amazing margins.
Curtain not closing on Medient
By Patrick Donahue
news@effinghamherald.net
UPDATED: June 19, 2014 6:06 p.m.
In spite of the tumultuous moves at Medient Studios, Inc., last week, maybe the planned massive studioplex won’t be left on the cutting room floor.
Jake Shapiro, the new chief executive officer for Medient, said last week the company is going to get to the business at its essence — making movies. And it plans to start producing movies locally.
The talk after the moves and upheaval can be seen as a validation of co-founder Manu Kumaran’s vision. Shapiro and new board chairman Charles Koppelman said last week they are committed to the movie-making process Kumaran laid out more than a year ago — shooting the same movie in a handful of different languages for distribution in multiple markets, using technology and other ways to curtail labor costs.
The business model, on its face, certainly looks appealing. Audiences in countries get to see and hear the movie in their own language, instead of the voices being dubbed over or subtitles across the bottom of the screen. Audiences will have a more instant and direct connection to the movie in front of them.
But Kumaran’s removal from the leadership of the company he founded was a repudiation of his management style and approach.
“The most important message is that this is a team that is being led by the reality dream team,” Shapiro said last week. “The reality dream team of our board of directors and our current management team have all proven themselves in entertainment, politics, government, film, television, music, and using all those resources with a laser focus to create the shareholder value, to minimize the excessive overhead and to make movies that generate the profits and the growth and the value of this company. And part of the key of making those movies is building the studioplex.”
But along the way, there have been setbacks. B.L. Harbert, originally announced as the general contractor, and Medient parted ways. New York financier Matthew Mellon was named a principal but departed just a few months later.
It was evident earlier this year the frustration as the scope of the first phase changed. Instead of the studios and other production facilities going up, Medient decided to add the housing component, greatly multiplying the need for water and sewer, which raised eyebrows with IDA officials. Suddenly, the amount of water needed jumped from around 100,000 gallons per day, within the IDA’s capability, to several millions of gallons a day, which is far beyond what they could provide and beyond what they were led to believe they would need to deliver.
It was back in March when Kumaran told the IDA he expected to be in construction in eight weeks.
“I am tired of projecting things that don’t happen on the date,” he said then.
Apparently, so too were the investors and others he brought on board.
When Kumaran talked with people from around the community, he displayed a charming and engaging style. There were plenty of skeptics last August at the Effingham Chamber of Commerce’s annual retreat as Kumaran started talking about his plans for the property just outside of Meldrim. By the time he was done, he largely had won the room over.
“I’m a simple man from a faraway land,” he likes to say.
But Shapiro, Koppelman, an entertainment industry veteran, financier Joseph Giamichael and former New York governor David Paterson decided Kumaran’s gregarious nature wasn’t enough anymore.
Shapiro said “The Damned,” set and planned to be shot in Savannah, will go ahead as scheduled. The espionage thriller “Kickback,” with a stellar cast of John Cusack, Rutger Hauer, Sean Astin and Mischa Barton, probably won’t get made, at least not by Medient.
Medient, founded in 2002, has made 14 movies. In addition to “Kickback,” the studio also had in the works “Kilat,” a martial arts film, and “The Battle for Benaras,” a documentary on the recent elections in India. Kumaran was the producer on “The Battle for Benaras,” and it has been scheduled for an August release. The highly-acclaimed “Yellow” is still scheduled for a late summer release.
“One of the most important things for us right now is to generate as much film production, the best content at the lowest cost. And by shooting films in and around Effingham County, Savannah, Atlanta, our cost structures are going to be more attractive than shooting overseas,” Shapiro said.
It’s evident the Leaf, the suspension bridge and the on-site housing for workers, along with the planned hotels and retail shops on what was going to be the public access portion of the property, will remain only in plans. Also, whatever the IDA has spent and will spend on the project to get it developed was going to have be spent on whatever or whoever comes to the tract. If the deal with Medient does fall through, should something follow it, the IDA almost assuredly would be asked to put some skin in that game — which it already has.
While Shapiro, Koppelman and the new team have pared back the grand scale of the vision and have pared down the studio’s structure, it also may make it easier for what has been dreamed to this point finally open for audiences.
This is looking good so far. Now we just need to build some momentum. Hopefully the OS will be unchanged at 10:45 and this will rip higher.
They want to RS to uplist in order to find my institutional longer term investors and raise capital for the Studioplex.
I do not think replacing two CEOs that quickly is a smart move. It would give the impression that the board has no idea what they are doing. Especially when you just gave the new CEO 40M preferred shares. Medient needs consistency and to stay focused on the goal. We need continuity in the company's employees. You can not keep constantly changing management teams. It is extremely disruptive. I am sure a big reason Jake was made CEO was because he was familiar with what is going on and was able to retain the necessary employees. An outsider would have taken awhile to get up to speed which Medient cannot afford right now. I would have preferred to have gone in another direction with CEO but Jake is our guy at this point.
At this point I am sure the board and CEO are aware of shareholders general sentiment regarding the split and I think all longs here should stop trash talking Jake until we see what he does. The board will reveal their plan when they deem fit. Give them at least couple of weeks. Jake was appointed less than a week ago. All of this constant panicking is hurting investor confidence and discouraging new investors.
Yeah they are Medient's.
I know its absolutely crazy. These people expect everything to be corrected in 3 days. That is the investment time frame unfortunately for a lot of the holders of MDNT.
Per the 10k:
In 2012 and 2013 We generated revenues from the release of Storage 24, and the sale of prequel and sequel rights on the film. It is anticipated that accounts receivable therefrom will be paid to the Company in the third quarter of 2014.
They made about 5.4M on storage 24. If they collect those receivables, this dilution should end. Plus Yellow and Battle of Banaras will be released in August bringing in further cash and revenue. Better days are ahead.
Lets give Jake at least a couple of weeks to show us something. Per todays filing, they booted Manu about a week ago and appointed Jake less than a week ago. I guarantee you Jake wants the stock price as high as possible. He wants his 40 million preferred to be worth as much as possible. I am sure that Patterson, Giamichael, Koppelman, Merriman and Jake are still working out the plan going forward. This is a big transition. I am sure that we will hear from them within the next couple weeks. Maybe even sooner.
The Battle of Banaras has already been paid for. It is Medient's property. As far as we know, it will be released on August 15th, India's independence day. I am not sure where the Tarantella joint venture stands.
Listen to the conference call. They said the board issued Jake Shapiro 40 million preferred shares then terminated Manu Kumaran as CEO and Chariman. Are you calling Charles Koppelman a liar??
Lol ok.... Listen to the conference call.
The preferred shares are convertible to common shares at a 1 to 1 ratio per the SEC filings. Manu will not be getting rich unless we all get rich.
I disagree, the board would not have acted unless they were 100% sure in the legality of what they were doing. From the corporate bylaws Debbie posted, it looked completely legal what the BOD did. Manu is kidding himself if he still believes he can regain control.
People were not working for free. Potentially, the management team was working for below market pay and the founders for free. However, I think they were hiring because of the way overhead grew over the last few months. I always thought the number of people working for the company was excessive given the small number of projects they were working on.
I sent you my count via email.
I think most people are accurate when they give this a .02-.04 price target in the near term. I would look at the book value which is almost .01. Plus the Effingham county incentives which are at least worth another .01 or more. Especially the tax credits which will allow Medient to achieve extremely high margins.
Obviously if Yellow does better than expected the price target could be bumped up a few notches. Over the long term, I still believe the sky is the limit. This could achieve a billion dollar market cap if the Studioplex is built. It will take a few years to get there.
What are you proposing in your letter to management?
Do not forget that the company expects to collect their account receivables in Q3 per the 10k. That quarter begins in a month. Not sure if it will be collected all at once but they have 5-6M in receivables on the books.
Manu and his cronies must be selling their shares. They would be the only ones dumb enough to do so at the all-time low. You heard Shapiro the days of destructive dilution are over. This has only one way to go and that is up. This company will have huge revenues toward the end of this year with the release of Yellow. This is a real company with big things happening. Not your typical garbage shell sub-penny stock.
Its a new era for Medient. One without destructive dilution. No more Manu and Koppelman at the helm. Barely anyone made money with Manu at the helm. He was terrible and should have been removed earlier.
Do not forget that Yellow is being released later this year. This is expected to bring in at least 18M in revenue which was the cost of the film. Some believe it could bring up to 50M or more given writer/director Nick Cassavetes track record.
Koppelman straight up said he would be meeting with his contacts to help medient get financing and make deals. He would not put his reputation on the line unless he had full control.
VFIN is faking. They moved back with a small hit yesterday. The O/S has not grown in 3-4 days per the TA. VFIN may have a few residual shares if any.
We need to get rid of all the irrational traders/flippers here in penny land. Then we will move higher.
Its only a gap if it opens above yesterday's high.
He said NO MORE TOXIC FINANCING ARRANGEMENTS. Listen to the call.
I hope Koppelman makes some large share purchases to inspire confidence. He it the Chairman of the Board and should own a substantial equity stake.
The problem with penny traders is they do not see this as a real company. They just see it as a trading vehicle. The goal of the R/S is not to dilute more shares but to help the company achieve its financing goals for the studioplex. The R/S is likely weeks to months into the future. Shapiro said that the days of non-stop dilution are over. They have cut expenses and laid off a number of employees. They have new financing arrangements to keep dilution to a minimum. NO MORE TOXIC FINANCING.
The valuation of this company is ridiculous. It has factored into it a poor management team that constantly dilutes. That is now over. Medient has a 3.7M market cap. It has positive book value of 16M-18M. Yellow has potential to bring in huge revenues over the next several months further increasing book value further. Furthermore, the company plans to film in Georgia using their tax credits. This will allow the company to drive huge margins. Jake says they expect the damned to have 70% margins. The incentives provided by Effingham are worth 75M-100M over the life of the project. With the new designs and Koppelman taking ownership, this project is more likely than ever to happen. This should be worth at least .02 with the potential for much more once the Studioplex gets going.
I am wondering how this management change will impact strategy. I am thinking it could impact two major areas.
1) I wonder if they will default on the Atlas debt allowing the atlas shares to go back to the HEB. Hopefully, no major payments have been made on that yet.
2) I wonder if they will consider letting MGM distribute Yellow. Manu said that they had several distribution offers including one from MGM.
What are your thoughts?
The call was excellent. There were several things I liked. First koppelman took ownership. He talked about how he was going to help the company succeed. Second, they kept the business plan but eliminated the stupid parts. Third they addressed all the issues under Manu and how they planned to fix them. Lastly, Medient sounded like a professional company for the first time. For a long term investor, that is what you wanted to hear.
I can not even imagine building a company for 10 years and then losing it and all the money invested into it. Sucks for Manu but he should not have screwed over his shareholders. The BOD had to approve this change. Jake would not have been able to do this alone.
Hopefully it is just on an interim basis if Shapiro is the CEO. Realistically, Koppelman is probably busy running his own company. Shapiro is one of the only people not loyal to Manu who knows the ins and outs of the company. Hopefully this is not the long term solution.
The Board of Directors would need to approve the transaction which if doing their job correctly would not approve at these price levels. Or the investors would have to buy 50% of the shares. They would need to file once they acquired 10%. So we would know something was up and the price would appreciate. This would only be possible if Manu's voting rights no longer apply.
You can only lose 100%. What if they pushed Manu out to take a deal with a partner who wanted control? What if Koppelman takes over? We will make huge profits. This is worth way more than it is selling at currently.