Two family-run companies have united following a deal that further exemplifies a consolidating animation industry. Italy-based entertainment specialist Rainbow, Europe’s largest animation studio and home to the billion-dollar Winx Club franchise, has acquired Vancouver, Canada-based animation service provider Bardel Entertainment.
Accirding to Iginio Straffi, president and CEO of Rainbow Group, the deal has the potential to exceed US$50 million – which DHX Media paid for animation studio Nerd Corps Entertainment last year - provided Bardel meets a series of predetermined goals over the next three years. While he couldn’t divulge the exact financial figures attached to the purchase, Straffi is candid about what attracted his company to the service studio.
“The biggest points for us are their quality of content and their reputation. Bardel is very serious and passionate about their work,” says Straffi. “The other point is that Bardel is like Rainbow in that it is a family company. Both are husband-and-wife-owned. I grew Rainbow from the bottom and run it like a big family, with a very straightforward management style. Bardel is similar, so the companies are compatible.”
That compatibility is being put to work almost immediately, as the companies will collaborate on new original IPs, the first of which will likely be a family movie.
Bardel, which has nine series currently in production for various third parties at its Vancouver and Kelowna, British Columbia studios, has already dabbled in original productions (Silverwing, The Christmas Orange, Mega Bloks Dragons, to name a few), and has animated North American hits Puss in Boots (DreamWorks), Teenage Mutant Ninja Turtles (Nickelodeon) and Jake & the NeverLand Pirates (Disney Junior).
Meanwhile, Rainbow is behind new series Regal Academy, PopPixie, Mia and me, and seven seasons of tentpole brand Winx Club, which has also inspired three theatrical films. Currently, the company’s Loreto, Italy-based studio specializes in 2D-prodiction, while the company’s Rome facility is similar to Bardel in that it offers a vast site for CGI and visual effects (with a staff of 100). Despite its size, the Rome studio doesn’t handle all of Rainbow’s animation, which is often outsourced to service studios in Korea or China.
“Now we will have the chance to have Bardel work on these shows, and to start new shows and movies to co-produce with them,” says Straffi. “The benefit of Canadian taxes makes the prices competitive. The salaries in Canada are high, but tax grants make it more affordable in many cases than some of other countries like Korea and India. So we would like to produce within Bardel, which will allow for better control and quality guarantee.”
Bardel will continue to provide services for the biggest North American players like Nickelodeon, DreamWorks, Disney, Warner Bros. and Cartoon Network. And the company will also provide animation on Rainbow’s programs – that is, as long as there’s enough room in the pipeline.
“We want to use their facilities for our productions, as we are expanding our portfolio and have several new shows in the pipeline. And we want to produce alongside Bardel. Hopefully, they have space for us. If they don’t have capacity for us, we will find animators somewhere else,” says Straffi. “We don’t want them to lose a customer like DreamWorks of Nick because of us. We didn’t buy them to come in and change their successful model.”
To that effect, Bardel’s name and its 650+ employees will remain intact, as will its management team, and the services that it has provided for more than three decades will remain unchanged.
The long-term plans of Bardel CEO Delna Bhesania, however, indicate growth is in its future.
“Rainbow has a big presence in Europe and Asia, and Bardel has a strong presence in North America. Put the two together and it really becomes a global powerhouse,” Bhesania says. “Rainbow’s expertise in licensing and distribution really gives us the ability for feature film production. We will be starting at MIPCOM to discuss those next steps.”
In terms of Rainbow’s reach, consumer products sales generated from the company’s Winx Club franchise alone account for more than half of its US$4.3 billion in global retail revenues last year, according to Licensing Magazine’s list of Top 150 Global Licensors. (Straffi says that Rainbow’s take-home after agent and licensing fees is less than 10% of that figure). Winx Club draws 15 million viewers every day across 115 broadcasters, and the company’s Mia and me series, co-produced with Germany’s Hahn & m4e Productions, is following in its big sister’s footsteps, proving to be a fast-growing licensed property in 2014.
Even with a crop of unannounced projects on the horizon, additional production studio acquisitions shouldn’t be expected from Rainbow, which now employs more than 1,000 animators between its Italian and Canadian studios.
“We will look at acquiring IP and companies, but not production studios,” Straffi adds. “Bardel is big.”