IDW Media Holdings has been provided $28 million in loans from its majority owner/board chairman Howard Jonas to fund "broadened production costs and necessary operating costs" for its tv & film division, IDW Entertainment.
IDW initially borrowed $5m from Jonas in August 2018 to fund corporate overhead and IDW's productions, with the note maturing August 2022. In November, Jonas made a $26m bridge loan available, with IDW taking $23m in December 2018. These funds were also to support IDW's current TV/film productions, as well as unnamed "additional properties."
These funds went towards several specific projects, including:
- IDW self-financed a Locke & Key pilot for Hulu at a cost of $13.6m, but the streaming service passed on airing the show. The company has since sold the series to Netflix, but are not using the filmed pilot.
- Netflix's October Faction, which IDW said is "expereincing meaningful cost overages." They also note that bank financing for the series was delayed.
- Syfy's Wynonna Earp, which IDW has taken on financing production of seasons four and five itself. According to IDW, Syfy's license fees for domestic rights only cover 50% of the production budget; they have begun shopping the series to foreign networks and streaming services to recoup the additional investment costs.
- IDW says that Syfy's V-Wars "may need additional post-production investment prior to delivery in early 2019".
The company goes on to say that IDW's TV/movie division previously drew upon the profits from its sister divisions, IDW Publishing and CTM Media Group, to fund its operations but due to "flat performance" in the second half of 2018 there were less funds than needed.
"As the company continues to leverage its intellectual property (IP), [IDW] faces the need for production investment, as well as additional infrastructure costs needed to manage operations for its growing slate of content and other operations," states the company. "[IDW] anticipates the need for further funding, and the company is planning to raise capital from existing stockholders by way of a private placement memorandum that will include the offering terms."
Jonas is the chairman and founder of New Jersey-based telecommunications company IDT Corporation, which bought a majority interest in IDW back in 2007.