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48 MOKEY BEIEtND THE SCREEN
1,300 2nd Pref. and 10,942 ordinary shares, and W. D. Bartholomew, with
7,050 1st preference shares.
Entertainments & General Investment Corp., Ltd ,formed in 1930 with a nominal capital of £210,000, has a board similar to that of County Cinemas, M. Silverstone of United Artists being an additional director. The buUc of its shares are held by board members of County Cinemas, Ltd., but F. M. GuedaUa, of U.A., also holds a substantial blocks of ordinary shares.
The cinemas of this circuit appear also to be registered as separate companies* raising capital in their own names.
B. — Independent Production Finance.
47. The rapid expansion during the last eighteen months of British independent production on a scale more ambitious than that of mere quota " quickies," has led to a financial situation which bears all the characteristics of a highly speculative trade boom. As we have seen, these production units are almost mthout exception private companies, with relatively insignificant capital resources of their own. The great bulk of the production cost incurred by them is secured by means of insurance policies against the non-payment of bank overdrafts with specified Umits, varying from £1,500 to £450,000 on single guarantees. The security offered is the highly problematical one of the expected returns from films about to be produced or in process of production. It should be noted that this short term loan financing is resorted to even in those cases where a percentage of the cost is advanced by the distributing concern for whom the film is bemg produced, while the bank overdraft of Gaumont-British shows that even the large combines, relying mainly on the assured market of their cinema circuits, are affected as soon as they attempt to produce for a world market. In order to obtain an idea of the scale of this financing and of the financial interests involved, we have made an analysis of the particulars of charges registered, as published in the Kinematograph Weekly, between February and November, 1936.* From this analysis it appears that the total amount raised in the form of guarantees (and in a few instances in that of debentures) by production companies, other than studio enterprises, between January 16th and October 30th, was in excess of £4,050,000 (in six instances the amount charged was unspecified). £2,823,300 of this sum represents guaranteed advances for which a single company Aldgate Trustees Ltd., acting as trustees for the unknown guarantors, is registered as " mortgagees or persons entitled to the charge."** The companies concerned and the sums were : —
* These particulars are not necessarily complete, and they refer exclusively to the first 10 months of 1936.
**Companies Act, 1929, Section 79 : " Particulars of mortgages or charges created by a company registered in England."