Yahoo News Leonine Interview: After Shaking Up The German Biz, CEO Fred Kogel Talks 2020 Priorities, The Munich HQ, Growth Areas & The State Of The Local Market – EFM
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EXCLUSIVE: New York investment firm KKR began its remarkable German buying spree 12 months ago. When it was done, one of the world’s biggest film and TV markets looked dramatically different.
The ambitious studio it created, Leonine, is an accumulation of companies including film and TV powerhouse TMG, film distributor Universum, Dark producers Wiedemann & Berg and production outfit i&u TV.
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One of the most-talked about new companies in Europe, Leonine suddenly has a library of thousands, hundreds of staff and impressive pulling power. Consolidation on higher ground makes sense in a market where the streamers are growing apace.
The firm’s clout has already been brought to bear on film markets, where it is inevitably among Europe’s biggest buyers. Major acquisitions include Knives Out (990,000 admissions/$9.6M box office in Germany, making it the third-biggest film of 2020), Hustlers ($2.8M B.O), and multi-million dollar pre-buys including Inferno and Moonfall.
On the eve of EFM, we spoke to Leonine CEO Fred Kogel – formerly of ZDF, ProSieben and Constantin – about the firm’s remarkable rise, plans for EFM, future growth and the state of the German market.
Deadline: What are the priorities for Leonine in 2020?
Fred Kogel: The process of integrating and realigning the various companies under Leonine Holding will continue to be a priority for us in 2020. We have acquired five companies and we are talking about a full integration including coming together under one roof in a new building in Munich – all this in under 12 months after the last closing. And we have taken a big step forward in what we do for our customers. The integration of all units is a complex task, both structurally and culturally. We have put together a great management team to drive and implement this change process involving all levels and employees.
The Leonine Holding comprises three business divisions: Leonine Production brings together all the production companies and producers in the group. This has resulted in a highly creative, agile unit that is geared to contemporary customer requirements. This unit is in a position to produce high-quality and internationally leading content out of Germany for all program providers, whether feature films, premium TV-series, non-fiction entertainment, shows, infotainment or short form content for social media networks in all genres. We have pooled all distribution activities under Leonine Distribution. The theatrical releases as well as the digital and physical distribution of our content take place in this segment. We refine our content through targeted marketing and continue to build up our high-profile program library.
Under Leonine Licensing we concentrate the entire licensing business. We maintain partnerships with all players in the U.S. and in German-speaking Europe for feature film acquisitions and TV-series co-productions and we also intend to expand our world sales activities in the future.
Deadline: Tell us about your new HQ in Munich…
Fred Kogel: Our new headquarters are still under construction and are located at the end of Leopoldstrasse in Munich. The name of this world-famous street and the lion as the Bavarian heraldic animal are a perfect match for our company name Leonine and connect our roots with our values, which include courage, energy, confidence and a strong sense for team play.
Since we maintain many international business relations, a good access to Munich Airport with its excellent flight connections was very important to us, which is the case at this location. Construction work is progressing well and we are confident that we will be able to move into our new headquarters as planned at the beginning of December 2020. We will bring together approximately 300 employees of all Leonine activities in Munich at one location on about 6,400 square meters of floor space.
We have deliberately chosen a spacious area, as we will continue to grow in the coming years. It is a highly functional building with state-of-the-art equipment, designed as an open space office, by the way also for the management team. In addition to a large Community Hub, where the whole team can come together for joint meetings or events, we also have a roof terrace with coffee bar and two wonderfully planted inner courtyards, as well as sufficient retreat options for concentrated and creative work in teams or alone.
Our headquarter reflects what we are: young, innovative, progressive, tech-savvy, international. In addition, we have facilities in Cologne where our great non-fiction entertainment company i&u TV with 120 employees has its home and we operate production offices in Berlin.
Deadline: What are the priority projects this year when it comes to film and TV production?
Fred Kogel: This year, we will realize a total of approximately 100 projects with Leonine Production and the production companies Odeon Film AG [a TMG subsidiary], Wiedemann & Berg and i&u TV. Odeon is currently shooting three series for ZDF, including the seventh season of A Case for Two, the 15th season of The Prosecutor and the ninth season of Disappeared – the M.P.U. as well as a spy series set in Berlin in the 1960s called Spy City.
In co-production with YLE in Finland, Odeon will produce the second season of the series Deadwind. Wiedemann & Berg has wrapped shooting the third season of Dark and the new series Tribes of Europa for Netflix. For TNT, Max Wiedemann and Quirin Berg are producing Almost Fly, a series about the beginnings of Hip Hop in Germany and for the new streaming service Joyn and Sat.1 they are producing the six-part series Blackout, which is based on the best-selling book of the same name. They also just started shooting the second season of Pagan Peak for Sky.
Our production unit i&u TV realizes very popular and successful show events for the major German free TV stations. Shows include Klein Gegen Groß for ARD and Denn Sie Wissen Nicht, Was Wassiert for RTL. With the weekly format sternTV and its accompanying YouTube-channel, i&u TV runs the most successful late-prime-time infotainment show on German television.
Our Chief Digital Officer, Christian Meinberger, recently produced the social media format #yourMSC in cooperation with the prestigious Munich Security Conference and YouTube. Three international YouTubers met with heads of state, top politicians, scientists, military and business leaders during the conference to provide young people with interesting insights during one of the most important conferences on global security.
Deadline: To what extent do you need to keep growing and into what areas?
Fred Kogel: In 2020 we are still busy consolidating the companies and growing organically. Further growth is on our agenda from 2021 onwards, especially in the areas of German production, international co-production and world sales. There may also be further M&A activities, if it makes sense.
Deadline: How does a new German indie studio co-exist with the streamers?
Fred Kogel: We do not compete with the streaming providers. They are our partners. We aim to be the one-stop shop for premium content for all our partners. Whether feature film or series, fiction or non-fiction, whether in-house-produced, co-produced or licensed, whether national or international, whether new product or library, with us, every program provider gets a 360-degree offer including social media formats that is tailored to their individual needs and is among the best available on the market.
We share a great passion for content and are looking to be a reliable partner for creative talents, helping them realize their ideas. With our award-winning team of producers, like Quirin Berg, Max Wiedemann, Mischa Hofmann and Andreas Zaik, and our distribution and licensing units, we can accomplish just that. The demand for programs will continue to increase due to the market entry of new players and new forms of use will generate new types of content. Christian Meinberger produces content for social media platforms. We are also very well aligned in the digital sector. In this sense, our aim is to help shape the digital transformation as a preferred partner for program providers of all kinds.
Deadline: How active will you be on the acquisitions front at EFM and other major film markets this year? Will you have output deals?
Fred Kogel: Our operational goal is to release about 20 films theatrically each year and to continuously expand our extensive licensing library in terms of quantity and quality. Five of those titles will be local German productions of Leonine or co-productions with our valued partners.
Program providers of all kinds are to find premium content that suits their individual needs. That’s why we will remain very active in feature film acquisitions and will be present at all important film markets. This also applies to the EFM. With Hustlers and Knives Out – our first acquisitions as Leonine – we have already released two new feature films with great success.
Hustlers delivered according to our expectation at the box-office. We released Knives Out across cinemas in German-speaking Europe at the beginning of January. The movie is now close to one million admissions and continues to do very well.
Deadline: Will you be launching your own online content platform?
Fred Kogel: With Home of Horror, Arthouse CNMA, and Filmtastic, we currently have three SVOD channels and with TELE 5 and RTLZWEI two free-TV channels (with RTLZWEI being an investment) in the Leonine Distribution division. This is the unit dedicated to the exploitation of our licensed product.
All SVOD channels are available at Amazon Prime Video. Filmtastic is also available at Rakuten TV, on the Telekom Mediathek and on the platform Zattoo. We are looking to further expand the reach and availability of our SVOD channels. Apart from that, we have no plans to launch our own content platform and enter into competition with streaming providers. As I mentioned before: We see ourselves as their partner, not as a competitor.
Deadline: Many assume KKR will build Leonine into a formidable entertainment company, then look to sell it in say 3-5 years at a profit. Does that ring true to you?
Fred Kogel: This question is asked way too soon nine months after our start, but it is certainly legitimate. KKR’s investment is medium to longterm, that means 5-10 years. My team and I can live with that very well. We all want to build a successful company and want to grow. This is in the best interest for all our employees. As a private equity investor, of course KKR will want to sell one day at a profit. This also is very legitimate.
Deadline: How do you assess the health of the German market for film and TV content today?
Fred Kogel: In my opinion, the German-speaking market for the production of feature films, TV – fiction and non-fiction/entertainment – is very healthy. The established players are diversifying their existing business models. This has resulted in the market entry of new program providers such as Apple TV+, Disney+ as well as TVNOW and Joyn in the German-speaking market.
The demand for high-quality and internationally competitive programs will therefore continue to grow, also in Germany. This applies to all before mentioned types of content. And it applies just as much to the new market players as it does to the traditional TV broadcasters, who will have to fill one or another gap in their program schedules due to the increased competition for talents and content. In distribution as well as in production, we are in a phase of consolidation, which will gain up speed in the next five years.
Deadline: German box office has dipped in recent years. To what extent can Germany improve its exhibition infrastructure?
Fred Kogel: There is a lot of potential for improvement in the theatrical exhibition landscape. We need fewer and better films and better and more comfortable cinemas. Customer service, customer approach and the clever curating of theatrical releases by exhibitors and distributors will be key as well as production companies who don’t just produce their films because they can finance them.
In Germany alone, around 900 films were released in 2019, but 80% of them remained practically invisible, as the admission figures show. This does not make sense at all. In my opinion, the number of films released must be reduced drastically and at the same time their quality must be increased. Our aim is to release films theatrically, that are noticed by potential viewers, that inspire the audience and have commercial appeal. This also requires the corresponding commitment on the part of us as distributors by granting a release – and a P&A – commitment that will give the films a chance to perform.
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