Film com­pany pays debt but still faces High Court drama

Irish Examiner - - Business - Gor­don Dee­gan

Oc­tagon Films, the Wick­low­based pro­duc­tion com­pany be­hind dra­mas like Love/ Hate and The Bor­gias, has re­paid all of the start-up money ad­vanced to it by a Ger­man in­vestor 15 years ago.

Oc­tagon has been in­volved in a share­hold­ers’ row in the High Court over the past 12 months with the in­vestor, Berlin-based W2 Film­pro­duk­tion und Ver­triebs.

The €317,499 ad­vanced by W2, gave it a 49% share of Oc­tagon and a note at­tached to newly-filed ac­counts for the Wick­low com­pany said that the money was fully paid as of the end of Septem­ber last year.

The loan from W2 was un­se­cured and was due to be re­paid in 2004, 2005 and 2006 out of an­tic­i­pated re­coupable de­vel­op­ment costs from suc­cess­ful movie pro­duc­tions.

In the High Court, W2 is su­ing the two direc­tors of Oc­tagon, James Flynn and Mor­gan O’Sul­li­van, claim­ing that it has lost es­ti­mated rev­enues of €25m in re­la­tion to ac­tiv­i­ties of Oc­tagon Films.

Mr Flynn and Mr O’Sul­li­van — who own the re­main­ing 51% of the com­pany — deny what they de­scribe as “un­founded al­le­ga­tions” and are fully con­test­ing the ac­tion.

The new ac­counts make ref­er­ence to the dis­pute and state that three sep­a­rate le­gal pro­ceed­ings have arisen in­volv­ing Oc­tagon which all re­late to a dis­pute be­tween the share­hold­ers.

“All three cases are due to be con­sid­ered by the High Court dur­ing 2017.

“The fu­ture of the com­pany is likely to be de­cided by the out­come of these cases,” the ac­counts, which were signed off on ear­lier this month, said.

W2 Film­pro­duk­tion und Ver­triebs has also de­manded pay­ment of in­ter­est on the orig­i­nal €317,499 loan.

The in­ter­est bill is €186,872 and Oc­tagon said it “is dis­put­ing and has de­nied” the bill.

A fur­ther note said that Mr O’Sul­li­van and Mr Flynn “are of the opin­ion that the in­ter­est penalty de­manded is not payable and as such does not rep­re­sent an obli­ga­tion on the com­pany and ac­cord­ingly no pro­vi­sion has been made in these ac­counts”.

Ac­cu­mu­lated prof­its at Oc­tagon Films last year rose by €122,576 to €298,494.

The firm’s cash pile de­clined dur­ing the year from €272,439 to €94,148.

The com­pany has also been in­volved in the pro­duc­tion of the in­ter­na­tional drama Penny Dread­ful and the hit movie, Cal­vary, which stars Bren­dan Glee­son and Chris O’Dowd.

The per­for­mance of Oc­tagon Films Ltd is not rep­re­sen­ta­tive of Oc­tagon’s over­all busi­ness, as the com­pany sets up a num­ber of spe­cial pur­pose com­pa­nies for its var­i­ous projects.

Hol­l­i­day Grainger as Lu­crezia Bor­gia from The Bor­gias, one of the shows pro­duced by Oc­tagon Films.

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