Movie Distribution Acquires Canadian and UK Motion-Picture Businesses

Movie Distribution Income Fund closed, on October 15, 2003, its initial public offering of trust units, raising total proceeds of $156 million. The proceeds were used to acquire a 43 per cent interest in a newly-formed limited partnership, Motion Picture Distribution LP, which in turn applied the offering proceeds and bank financing to acquire the Canadian and U.K. motion-picture distribution and related businesses of Alliance Atlantis Communications Inc., for total consideration of approximately $231 million. The underwriters’ over-allotment option was exercised on November 14, raising $23 million of additional proceeds.

Following the reorganization, Motion Picture Distribution is the largest distributor of motion pictures in Canada, with rights to films produced by leading independent studios, including Miramax, New Line Productions, Inc., Artisan Pictures Inc. and Focus Features. The partnership also acquired Alliance Atlantis’s interest in the Alliance Atlantis Cinemas chain of movie theatres.

For the offering and the reorganization, the fund, the partnership and Alliance Atlantis were represented by Torys LLP, under the direction of Paul Laberge, senior vice-president, corporate development, and general counsel, Martin Saipe, director, corporate legal, and Lisa Mendelson, corporate counsel, Alliance Atlantis. The Torys team included Glen Johnson, Gary Solway, Corrado Cardarelli, Vanessa Grant, Ann Marie McGovern, Wendy Kennish, Marni Halter, Amanda Roelofsen, Ron Nobrega, Tim Rorabeck, Kevin Andrade, Ian Cooper, Robert Soccio, Christina Medland and Bill Estey in Toronto, and Dan Miller and Mark Adkins in New York on U.S. offering and disclosure issues. Adam Delean, Tom Zverina and Justin Young also of Torys represented the partnership and Alliance Atlantis on the partnership’s new term and revolving credit facilities and negotiations with Alliance Atlantis’s existing lenders.

The underwriters were represented by Stikeman Elliott LLP, with a team led by Jeffrey Singer and including David Weinberger, Stewart Sutcliffe and Trent Mell (corporate and securities) and John Lorito (tax); and by Goodmans LLP, with a team that included Krista Coburn and Samantha Traub (corporate) and Maureen Berry and Alan Bowman (tax).

Gordon Baird, Mark Rasile, Julie Ouellon-Wente, Richie Clark and Jean-François Boisvenu of McCarthy Tétrault LLP assisted the bank syndicate in connection with the new $100 million credit facility provided to the operating partnership, into which the motion picture distribution business was transferred.

Lawyer(s)

Timothy P. Rorabeck Maureen Berry Ann Marie McGovern Adam E. Delean John G. Lorito Trent Mell Tom Zverina Amanda M. Roelofsen Gary S.A. Solway Jeffrey Singer Ian G. Cooper Marni S. Halter Samantha Traub Krista Coburn Vanessa Grant Mark R. T. Adkins Julie Ouellon-Wente Corrado Cardarelli Glen R. Johnson Stewart Sutcliffe Kevin H.M. Andrade Justin D. Young Ronald E. Nobrega Christina H. Medland Gordon D. Baird Wilfred M. Estey Alan Bowman Mark Rasile Wendy B. Kennish Richie Clark David Weinberger