Giant Technicolor VFX files for Chapter 15 amid the restructuring blame the coronavirus

Technicolor has three main divisions: DVD services, electronics and production services (vfx, post-production and animation). The DVD arm has suffered a beating in recent years; In its presentation in the United States, the company indicated general change in traditional media as a reason for its problems.

But storm clouds also loom over their production units, including MPC, Mr. X, The Mill, Mikros Image, and Technicolor Animation Productions. The presentation also noted: "To exacerbate the situation, the Covid-19 pandemic caused theatrical releases to be suspended and production deadlines delayed, significantly depressing Technicolor's revenue from production services."

The company reiterated this argument in a statement:

Like many companies in the media and entertainment industry, the global Covid-19 pandemic has hit us seriously. On Monday 22 June we announced that we have agreed in principle with our lenders a new financial framework for our long-term sustainability. It is the financial framework from which we will build a stronger future as a company and, in turn, become an even stronger partner for our customers. This plan provides for the entry into the company of 420 million euros of new funds and the reduction of financial leverage.

Our new financial framework and the approval processes necessary to implement it will not affect our operations. Providing superior service and innovative solutions to our customers is our priority, in addition to maintaining the strong relationships we have with them.

Technicolor has already invoked the pandemic as justification for the changes, but the company's problems began before the virus occurred. Here are some recent examples of business interruptions:

• Last month, Mill Film and Mr. X merged under the latter name. A Mill Film statement described the move as "a direct and necessary response" to the effects of the coronavirus.
• In the same month, Moody's Investors Service downgraded Technicolor's rating to Caa2 from Caa1, citing "the impact of the pandemic on Technicolor's operational performance and, in particular, the uncertainties surrounding the execution of the proposed rights issue to increase approximately 300 million. euros ", but also indicates the" poor operational performance "of the company before the pandemic.
• In April, Canada Art Babbitt Appreciation Society labor activists criticized Technicolor in a letter to CEO Richard Moat, accusing hundreds of layoffs in three Montreal studios: MPC, Mr. X and Mill Film. Technicolor did not respond to Cartoon Brew's request to comment on the matter.
• Last December, the MPC studio in Vancouver closed abruptly. I had recently worked Pokémon Detective Pikachu, Maleficent: Evil Lover, Cats, and the redesign of the title character in Sonic the Hedgehog.
• Also last December, Technicolor and its former CEO Frederic Rose were indicted in France on charges of fraud and breach of trust. The allegations were linked to the 2011 bankruptcy of post-production company Quinta Industries and the acquisition of the company by Technicolor the following month.

Among them, Technicolor studios work on dozens of features and series every year. Recent projects include Ad Astra, The Lion King, Lady and the Tramp, The Call of the Wild, Dolittle, Alvinnn !!! and The Chipmunks, Elena of Avalor, e The Mandalorian. The next projects include Spongebob movie: Sponge on the Run, The Little Mermaid, e West Side Story.