Border guards interrogate suspected drug smugglers. Gold miners hunt for treasure. Army recruits are deployed in Afghanistan following intense physical training.
These aren’t the plot synopses of TV series imported from south of the border. Rather, they’re homegrown B.C. productions that have caught the eye of one of the world’s biggest entertainment companies.
Since July, Toronto’s Entertainment One (LSE:ETO) (eOne), which generated about $1.4 billion in revenue in 2013, has bought two local TV production houses specializing in a mix of reality and scripted TV series.
“We were looking for companies in Canada that really were leaders in the factual and reality [genres],” eOne Canada president Margaret O’Brien told Business in Vancouver.
She said eOne’s pursuit of Paperny Entertainment and Force Four Entertainment was part of a growth-through-acquisition strategy. One of the main conditions for the acquisitions was that the companies produced shows that could be marketed internationally.
In late August, eOne bought Force Four Entertainment for an undisclosed amount.
The production company is behind series such as Border Security: Canada’s Front Line and the sitcom Seed, which aired on City before being picked up by The CW in the U.S.
A month earlier, the selling price for Paperny Entertainment was $29 million. The company spent a decade producing one-off documentaries for CBC before jumping into reality TV and developing shows such as Yukon Gold and Eat St.
Both production houses are maintaining offices on the West Coast and will function as independent subsidiaries.
Meanwhile, Paperny Entertainment’s team in Toronto is expected to move into eOne’s new head offices within a year.
But O’Brien confirmed senior management signed long-term contracts with eOne to ensure they stick around for the foreseeable future.
“Senior management is one of the most important things that drive the success of these businesses, both from a creative and a business perspective,” she said.
“We want them to continue to run their company in the way that they have that has made them as successful to date.”
O’Brien added the acquisitions provide eOne with a presence in Vancouver for the first time. She expects the company to soon make use of the resources on the West Coast when it comes to eOne’s own TV productions.
The acquisition of successful Vancouver businesses has been a common trend as of late.
Staples Inc. (Nasdaq:SPLS) bought PNI Digital Media for $74 million in July, and French eyewear giant Essilor closed a $430 million deal for Coastal Contacts in April.
And in a city that has struggled to attract and retain head offices, the co-founder of Paperny Entertainment said the deal with eOne made too much sense to pass up.
“We’re finding it harder and harder in our business to get shows made because money is tight, and this is during even a robust period in the industry,” David Paperny told Business in Vancouver.
“They [eOne] have a huge distribution network. They sell shows around the world. They’ll help me sell our shows.”
And, Paperny noted, eOne has the resources and industry contacts to help the new subsidiary get involved with more digital platforms as ad revenue moves from TV to online.
EOne announced in May it had taken an equity stake in the Canadian interactive agency Secret Location.
Paperny, who was nominated for an Academy Award in 1994 for the documentary The Broadcast Tapes of Dr. Peter, said his division is already teaming up with Secret Location on multi-platform productions.
“The real success stories are partnering up with other success stories that complement each other.”
