French indie animation powerhouse TeamTO, which announced insolvency in September, has accepted an acquisition bid from Milan-based Riva Studios, which is subject to approval from the Tribunal Commerce de Paris. A hearing was planned for today but has been postponed until Nov. 20.
TeamTO is the production company behind the Children’s & Family Emmy-winning Netflix series “City of Ghosts” and other standout kids’ programming, including “PJ Masks” and “Elena of Avalor,” among others.
Riva and TeamTO have been collaborating on the adult animated series “Junichiro Jackson” for a year, and according to TeamTo President Guillaume Hellouin, “We started discussing a potential investment [by Riva] in the studio five months ago, but these conversations always take a long time, and as things sped up in recent weeks, the conversation changed.”
Initially, TeamTo received offers from three other companies, but Hellouin says Riva’s, which came in at the last minute, was the best fit for his company and is now “the only remaining offer; the other three didn’t work out for various reasons.”
The TeamTo president says that because discussions have been ongoing for months now, the terms are favorable, and he has been able to work closely with Balsamo to shape an acquisition offer that will allow for operations to continue under somewhat normal circumstances.
“The idea is that, at a minimum, all of the productions in our current pipeline will be delivered to our clients and partners, and everything in development will be pushed forward as normal,” he explains.
The largest change to TeamTo post-acquisition will be moving out of its brand new, state-of-the-art studio, which the company opened in Paris in late 2022. That studio ended up being the albatross around TeamTo’s neck that led to this week’s acquisition announcement.
Plans to open the environmentally friendly studio, which helped TeamTo cut its carbon footprint by 63%, officially kicked off in 2018, when the studio was producing an average of seven to eight titles per year, a number that had been steadily increasing in the years prior and one that TeamTo expected to increase to as much as 12 in the years to come.
However, the pandemic and later cuts in commissions from international streamers led to the bottom falling out of the European indie animation market, and TeamTo is now averaging only three shows produced per year in Paris. That number of productions is sustainable going forward, Helloin says, but only if the company relocates to a smaller facility.
“We have a team of 50 people in a studio that can accommodate 300. That’s not financially sustainable, so we need to create a new balance,” he says.
According to Helloin, equilibrium will require a reduction of staff. All the company’s fixed-term contracts will be fulfilled – as required under French law – but between 20-30% of the company’s temporary and permanent staff could be let go in the restructuring.
Exact details of the acquisition are still being ironed out and subject to regulatory approval, but the plan right now is for TeamTO leadership to remain largely intact and to keep the pipeline flowing as it has been for the past couple of years, but at a lower cost.
“We need to bring down the overhead so that with the level of activity we currently have, we are still breaking even. That’s the work we have to do with this reorganization,” Hellouin says.
Another significant change post-acquisition will be a split of TeamTO into three businesses: the TeamTO production company, the animation studio and a new R&D technology-focused branch that will license out tools developed by and for TeamTO.
In a release announcing the Riva bid, Corinne Kouper, SVP of Production & Development at TeamTO, explained, “The aim of this offer is to ensure the long-term viability of the business (i.e. current productions and projects under development). It will enable the teams to bounce back on solid footing with a shareholder base that has the resources to sustain the business while retaining its world-renowned talent, together with the support of its long-standing, well-established clients and partners.”
Jean-Baptiste Spieser, TeamTO CTO, added: “I would be thrilled to join forces with Marco Balsamo and his team. TeamTO’s R&D has already achieved remarkable breakthroughs for the studio, but by teaming up with Marco, we could elevate these advances across the entire industry. Together, we could deliver cutting-edge solutions that empower animation artists worldwide to fully realize their creative potential.”
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