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ANIMATION WORLD MAGAZINE - ISSUE 5.02 - MAY 2000
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BusinessCINAR Co-Founder Signed For Investment. On Tuesday, March 21, 2000, CINAR Corp. announced that co-founder, Ron Weinberg, and former controller, Mario Ricci, signed documents approving the company’s non-board-approved investments. CINAR’s spokeswoman, Suzan Ayscough, said, "The documents in question were signed either by Ron Weinberg alone, or by Mr. Weinberg and Mr. Panju or by Mr. Ricci." Previously, CINAR reported that their now fired senior executive VP Panju acted alone in investing the money. On Monday, March 20, 2000 [AF 3/21/00], CINAR announced that they had filed suit against three companies and one individual involved in the investment scandal. In the lawsuit, CINAR claims that Norshield International Ltd. of the Bahamas and affiliates Globe-X Management Ltd. and Globe-X Candiana Ltd., and Robert Daviault of Globe-X Management demonstrated "deceit and conspiracy" to misrepresent where CINAR’s invested money was being funneled. CINAR alleges that Globe-X Management promised US$86 million of CINAR’s funds to RBC Dominion Securities Inc. to secure a debt Globe-X owed. However, CINAR was led to believe that their money was clear and free. CINAR claims that the investment is void because the board of directors was not involved in the process. In a statement, Globe-X Management said the deal with CINAR mandated it to enhance returns on CINAR’s bond portfolio, and that "while there are staged maturities, [the] maturities would normally terminate by November 30, 2000." Globe-X states they have already let CINAR prematurely access the funds to the tune of $46 million even though scheduled maturities were only $25 million. In addition, some interesting coincidences came to light at the Tuesday press conference. RBC Dominion, the bank Globe-X Management allegedly promised CINAR securities to, is an affiliate of the Royal Bank of Canada who is CINAR’s bank. In turn, Norshield International is a reported affiliate of Norshield Financial Group (NFG), which is based in Montreal, same as CINAR. It has also been learned that Ricci, who left CINAR in November and signed documents okaying the non-approved investments, now works for NFG. Ricci was hired at NFG as vice president of finance one month after leaving CINAR. The extent of the involvement between NFG and Norshield International is also in question. NFG CFO Dave Smith said to THE GLOBE AND MAIL, that Norshield International has a licensing agreement to use the "Norshield" name and that NFG does provide "certain consulting and advisory services" to Norshield International, but that is all. Smith said that no companies directly under NFG are based in the Bahamas. However, NFG’s CEO John Xanthoudakis on the NFG Web site is quoted as saying that their "international group of companies" work out of "Canada, U.S.A., Europe and the Bahamas." Commenting on the Web site, Smith said, "Whoever wrote it may have got it wrong." Even with the new information on the scandal, the Toronto Stock Exchange and Nasdaq officials still haven’t deemed CINAR stock kosher enough to begin trading again. CINAR stock stopped trading March 9, 2000.
Nelvana Enters The Net Game. Nelvana Limited has announced the introduction of Nelvana New Media, a new division that will focus on developing new applications, products and delivery channels for Nelvana's valuable character library. The new branch will create a children’s Web entertainment site and interactive games based upon their characters for both CD-Rom and Internet distribution. "Nelvana New Media is an initiative that solidifies the future success of the Company," added Michael Hirsh, Nelvana Limited's co-chief executive officer. "The new division will use its expertise to benefit from this new avenue of programming and merchandising revenue." As part of the new venture, Nelvana has signed an agreement with Havas Interactive, one of the world's leading publishers of entertainment and educational software, to distribute CD-Rom titles based on Nelvana's book-based character family. Nelvana New Media will create at least two CD-Rom products each year at Nelvana's Toronto production facility, to be marketed and distributed to major territories by Havas Interactive. The first two titles will be based on Nelvana's popular Franklin character. The games should be available in time for Christmas 2000. Nelvana.com’s intended launch will be the summer of 2000. At first the new destination will focus on Nelvana's classic character brands, with interactive stories, games, postcards, e-mail and other customized entertainment experiences for children and families. "Our extensive character portfolio and technological capabilities put us in an excellent position to benefit from the convergence of production, distribution, broadcasting and merchandising over the Internet," said Patrick Loubert, co-chief executive officer of Nelvana Limited. Like many of the other entertainment sites, the new site will offer branded merchandise from Nelvana's licensees in its own on-line store. Nelvana New Media has also signed an agreement for the production of its Web sites and related on-line materials with Snap Media Corp. of Toronto, a leading Web content company. Nelvana Limited will invest approximately CA$500 million on upgrading its Web site in 2000. Miklos Tomka has been appointed general manager of Nelvana New Media. A former Bain & Company consultant and MBA graduate of INSEAD, Tomka has several years of strategy experience in the technology sector, including consulting to e-commerce companies. In his new position, he will be responsible for exploring, evaluating and developing new Internet-based technologies, developing relationships with advertisers, sponsors and portals, and evaluating potential investment and acquisition opportunities. The first production of the new arm of Nelvana will be When Quads Won't Leave, the world's first TV series produced entirely in Macromedia Flash. The new half-hour prime time Nelvana series will air on Canada's Teletoon. The new series, created by John Callahan, is based off of Callahan’s humorous cartoons portraying his own life in a wheelchair. |
Note: Readers may contact any Animation World Magazine contributor by sending an e-mail to editor@awn.com.
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