EIB to lend up to EUR 65 million to XDC for its digitization roll-out plans in Europe

http://www.digitalcinemainfo.com/european-investment-bank-EIB_02_18_10.php

February 18, 2010

Source: European Investment Bank

The European Investment Bank will grant financing of up to EUR 65 million to XDC, in the framework of the financing structured by BNP Paribas Fortis to contribute to its digitization roll-out plans in Europe. This will also strengthen XDC’s research and development activities to further improve its digital cinema solutions.

The loan facility granted by BNP Paribas Fortis, KBC, CBC and the EIB - the financing institution of the European Union - will finance digital cinema equipment aimed to be deployed in European cinemas in the scope of the “Virtual Print Fee” co-financing scheme. This scheme based on cost sharing between exhibitors and distributors has been signed by XDC with the 6 Majors Studio’s to convert up to 8,000 screens to digital over the next 4 years.

The participation of the EIB in the first tranche of the loan facility amounts to EUR 16 million. KBC Bank and CBC Bank will also participate in this facility with a contribution of EUR 10 million. BNP Paribas Fortis which had been mandated last year to structure, arrange and underwrite this 2 x EUR 50 millions project finance loan facility will provide the remainder of the first tranche or EUR 24 million. The loan will benefit, for a substantial portion, from an insurance cover provided by ONDD, the Belgian Export Credit Agency.

Ahead of these senior debt arrangements, XDC entered into a financing agreement with Barco, one of its preferred digital projector manufacturer partners. Barco will participate in this structure through a specific and tailored made vendor financing program.

"Financing capacity and technical innovation are key matters for XDC’s business plan execution” said Serge Plasch, XDC’s CEO. “This EIB loan facility will secure our long term senior debt requirements. Moreover, this will allow XDC to emphasize its R&D projects to serve the market with innovative solutions.”

EIB President Philippe Maystadt explained “how crucial it is, and even more in this period of shortened credit for niche sectors, to support long-term investment for young, performing SMEs with high potential. It is also important to support innovative projects with a strong R&D component with tailor-made financial products such as the Risk Sharing Finance Facility for Research Development and Innovation (RSFF) which we are using for XDC. He also added: We are pleased to support the development of XDC ; it has created its unique position as a key contributor in its field, bringing added-value to the distributors and exhibitors going to digital, and becoming a leader in the high-tech world of cinema.”