Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Johnny Canuck who wrote (40184)	9/3/2003 1:40:48 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 69307

Alliance Atlantis confirms spinoff of movie distribution unit as income fund 01:31 AM EDT Sep 03 TORONTO (CP) - Alliance Atlantis Communications Inc. confirmed Tuesday that it is spinning off part of its movie distribution business as an income fund, with the proceeds to be used to reduce debt. The Toronto-based film producer, broadcaster and distributor said it has filed a preliminary prospectus for an initial public offering of units in what is to be known as the Movie Distribution Income Fund. The fund will have a non-controlling interest in the Canadian and British movie distribution business while Alliance Atlantis will retain majority control. Details of the size and pricing of the unit offering were not disclosed Tuesday, but the company said additional information will be filed by mid-September. Alliance Atlantis is the largest distributor of motion pictures in Canada, and its wholly owned Momentum Pictures subsidiary is a niche player in the United Kingdom. The business distributes motion pictures primarily under long-term agreements with American studios and has a library of about 6,000 titles. Expectations of the spinoff have helped drive up Alliance Atlantis shares (TSX:AAC.B) to 2½-year highs in recent days. Tuesday's announcement came after the close of trading, with the stock off 27 cents at $22.90. It hit a 52-week high of $23.25 on Friday; the 52-week low is $11.51. The company said on Aug. 25 that April-June earnings rose 23 per cent from a year earlier, to $10.8 million on revenue of $164 million, thanks to strong growth in advertising revenue and continued success with its CSI television shows. In releasing those results, executives declined to comment on the income fund speculation, saying only that the company is "always looking at various financing options and ways to enhance value and enhance our capital structure and lower our cost of debt." However, analysts observed that the motion picture distribution business is the company's steadiest and most reliable generator of free cash flow.