CELEB
A Cross-Continental Film Alliance Takes Shape
Spain and South Africa are betting big on cinema. A new €25 million ($28.5 million) audiovisual partnership has officially launched, pairing Spain's state-backed investment vehicle SETT with South Africa's Known Associates Group (KAG). The deal promises to reshape production capabilities across the Iberian Peninsula while opening doors for international co-productions.
The collaboration centers on two major ventures: a Madrid-based production hub and post-production facilities strategically located in regions known for their generous film incentives.
Moonlighting Studios Spain: A New Creative Home in Madrid
The flagship project involves a $10 million commitment from SETT to launch Moonlighting Studios Spain. the European arm of South African production-services company Moonlighting Films. With a total capital injection of $20.5 million, the Madrid operation will focus on developing original projects and building intellectual property.
The company has an impressive resume, having provided production services for blockbuster titles like "Mufasa: The Lion King," "Mad Max: Fury Road," "The Woman King," and Netflix's "Resident Evil" series. The Madrid studio is expected to churn out 10 feature films and documentaries, bringing high-profile production opportunities to Spanish soil.
The Refinery: Post-Production Power Play in the Islands
The second arm of the deal sees SETT investing $4.4 million for a 49% stake in The Refinery's Spanish division. This South African post-production company will receive $9.1 million in total funding to establish state-of-the-art facilities in the Canary Islands and Basque Country. both regions offering some of Europe's most attractive production tax incentives.
The integrated post-production platform aims to keep more audiovisual work, spending, and creative control within Spain rather than outsourcing to foreign facilities. It's a strategic move to capture more of the production value chain domestically.
Why the Canary Islands? Tax Paradise for Filmmakers
The Canary Islands offer something mainland Spain can't match: a Special Economic Zone (ZEC) with just 4% corporate income tax and 7% VAT, compared to 25% and 21% respectively on the mainland. KAG has already initiated the process to establish operations within this favorable tax environment.
"This agreement with SETT marks a turning point for our company and for South Africa," said Tshepiso Chikapa-Phiri, KAG's group CEO. He emphasized that Spain will serve as a strategic platform for creating Spanish content with global reach while strengthening ties between the two nations.
Government Backing and Bigger Ambitions
Digital Transformation Minister Óscar López championed the initiative, stating that the government will continue such investments because they're highly profitable for the country. "The audiovisual industry is cultural; it is not only about the economic value and employment it generates," he noted.
This venture represents the second phase of the EU-backed Spain Audiovisual Hub Plan. SETT has also facilitated other international companies establishing Spanish footholds, including Mexico's Ítaca Films in Madrid, Good Films at Alicante's Ciudad de la Luz, and VFX giant DNEG taking an equity position in the Canary Island's Anima Kitchent.
Private funding for both ventures comes from South African investment holding company Sinobhukosi, completing a cross-continental financial alliance that could reshape European film production.
