investors are able to realize immediate returns on their investment between 100-120% before profits from Section 181 Federal tax writeoffs allowing 100% deductions, and, tradable tax credit incentives
United States of America (Press Release) October 14, 2007 --
Yuri Rutman’s New Private Equity, Hedge Fund, And High Net Worth Investor & Family Office Backed Structured Fund Announces January Start Date For "The Violinist" and a few other films as part of larger fund launch.
The film is one of many innovative structured finance deals that offers a potentially high yield investment, tax credits, an immediate ROI.
The attraction to Rutman’s deal is based on 2 funds he is setting up that caters to both institutional capital and smaller private equity firms and high net worth investors that want a taste. On one $1 billion deal currently out to large hedge funds and global private equity investors, he is leveraging a principal protected strategy that guarantees institutional capital plus profits from the finance, co-finance, and distribution of 40-100 films.
On a smaller deal, investors are able to realize immediate returns on their investment between 100-120% before profits from Section 181 Federal tax writeoffs allowing 100% deductions, and, tradable tax credit incentives similar to what real estate syndicators and investors utilize from Federal Historic Preservation Credits and other incentives. “But its more fun in my opinion”, Rutman adds. “That’s why so many dot comers, billionaires, and real estate guys are financing films. The structure is almost like developing a large commercial real estate project. Except in this case they can earn an instant ROI of 100-125% before profits, a hedge of revenues from several films, additional liquidity if we do an exit IPO, and see their names as credited producers in movie theatres, tv, DVD’s, etc. And if a film gets into the Cannes Film Festival, Sundance, Toronto, etc, the international travel perks are also in the mix”.
Rutman’s model is based on 100% financed films under 4 million, and 50%-60% financed films over that, with the deficit being covered by distribution advances. “So in some instances, I can make a $5 million dollar film, put in $3 million, pre-sell $2 million, and an investor still gets tax credits on the $5 million, plus a Section 181 write off on his entire investment, plus international profits, plus an option to convert his investment into public liquidity if I decide to do a reverse merger or an IPO on the London AIM. Multiply this by 5 or ten films in different budgets, genres, and tradable tax credits, and the potential for varying returns, distribution channels, markets, and long term library potential is enormous”.
The film is one of many innovative structured finance deals that offers a potentially high yield investment, tax credits, an immediate ROI.
The attraction to Rutman’s deal is based on 2 funds he is setting up that caters to both institutional capital and smaller private equity firms and high net worth investors that want a taste. On one $1 billion deal currently out to large hedge funds and global private equity investors, he is leveraging a principal protected strategy that guarantees institutional capital plus profits from the finance, co-finance, and distribution of 40-100 films.
On a smaller deal, investors are able to realize immediate returns on their investment between 100-120% before profits from Section 181 Federal tax writeoffs allowing 100% deductions, and, tradable tax credit incentives similar to what real estate syndicators and investors utilize from Federal Historic Preservation Credits and other incentives. “But its more fun in my opinion”, Rutman adds. “That’s why so many dot comers, billionaires, and real estate guys are financing films. The structure is almost like developing a large commercial real estate project. Except in this case they can earn an instant ROI of 100-125% before profits, a hedge of revenues from several films, additional liquidity if we do an exit IPO, and see their names as credited producers in movie theatres, tv, DVD’s, etc. And if a film gets into the Cannes Film Festival, Sundance, Toronto, etc, the international travel perks are also in the mix”.
Rutman’s model is based on 100% financed films under 4 million, and 50%-60% financed films over that, with the deficit being covered by distribution advances. “So in some instances, I can make a $5 million dollar film, put in $3 million, pre-sell $2 million, and an investor still gets tax credits on the $5 million, plus a Section 181 write off on his entire investment, plus international profits, plus an option to convert his investment into public liquidity if I decide to do a reverse merger or an IPO on the London AIM. Multiply this by 5 or ten films in different budgets, genres, and tradable tax credits, and the potential for varying returns, distribution channels, markets, and long term library potential is enormous”.
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