|
|
|
|
|
||
|
||
| News | Business | Feature | Opinion | Sports |
Tourist Info |
Classifieds |
Wednesday, May 10, 2000
Company looks for investors to build cabaret in Prague By Jasna Sykorova The principals in the joint-stock company Blue Point have already sampled Paris nightlife for inspiration and have found an attractive location in the heart of Prague for the establishment they intend to call the Rendez-Vous. They have rented a gleaming two-level expanse in a shabby, 1930s-era building at Narodni trida 36 whose primary occupants are now shops selling inexpensive clothing. They have a 10-year lease with an option for 10 more years. The cabaret will offer a mix of food, drinks and entertainment that will include show girls, live music and mildly erotic late-night dance performances designed for upscale audiences, according to Blue Point's promotional material. To go with its building and business plan, Blue Point found a high-profile program director to handle the club's entertainment -- the famous Czech pop singer Jiri Korn. The only thing still missing is the 70 million Kc [$1.7 million] needed to finance the project. "We offer an interesting opportunity for any investors that believe in our project," said Jiri Krampera, Blue Point's chairman of the board. He's trying to reduce the risks and sweeten the prospects for potential investors. "We plan to issue insured promissory notes [covering certain capital losses] in total value of 50 million Kc, and there are some other possibilities for financial participation, like silent partnership or sponsoring," Krampera said. The promissory notes, for 12, 18 and 24 months, have a nominal value of 1 million Kc. Investors are promised 10 to 14 percent evaluation depending on the date of the note's maturity. The brief business plan presented at an investors' meeting in early May assumes a three-year payback for investors. If 60 percent of the 350-seat capacity is filled each night, estimated revenues would be 91 million Kc per year, Blue Point said. Dreams end where business starts Though Krampera of Blue Point is optimistic, some from the financial and entertainment worlds are skeptical. "The entertainment business is very specific," said Petr Motloch, executive director of Patria Finance. "Only a few people are experts in it, and the business itself is very risky." He doesn't think Blue Point chose the right investment instruments. "If an investor pours money into a project in exchange for promissory notes, it basically means that if the project doesn't go wrong he will get 10 percent of an evaluation. But if it does, he has nothing," Motloch said. He said that entrepreneurs' risk insurance doesn't necessarily protect investors' money. "Insurance usually covers only pre-defined risks," Motloch said. He suggested that complete investors' safety might be better achieved through secured promissory notes, instruments by which a credible partner guarantees the project and deals with creditors if the project goes bankrupt. Krampera admitted that there is no such strong partner in the Blue Point project. "Our guarantees are the people that work on this project," he said, adding that he and Blue Point's experts have invested a half-year's work on the project already. However, the joint-stock company was registered only in March of this year, and it has executed only one project since its inception -- a restaurant that offers traditional Czech cuisine in Prague 1. And Jiri Korn, the pop star and co-owner of the show business talent agency Krach [Crash] and whose name has added luster to the project, is not yet directly involved. "The cabaret is not my idea," Korn said. "I am only going to be an employee of Blue Point." However, as the future program director, he knows what he would like. "When I was in Paris I saw cabarets that I really liked -- like Crazy Horse for example," Korn said, referring to the world-famous Crazy Horse Saloon. "But we want more than pretty girls," he said. "We would like to employ quality people for dance and tap-dance shows and to perform songs from various musicals. And for this we need perfect technical equipment, lights and costumes." And for all this, a lot of money is needed. "A cabaret can be unbelievably expensive," explained a man who was involved with Prague's famous Alhambra Cabaret, which operated during the communist era but went bankrupt in the years following the 1989 Velvet Revolution. "And people do not care about cabarets any more. They'd rather go to an Irish pub to have fun nowadays." Jasna Sykorova's e-mail address is jsykorova@praguepost.cz
 Nomura's latest cry for government bailout for IPB The crown comes tumbling down CSA looks to alliance to stay competitive New bankruptcy law puts pressure on executives to file
 Movers & Shakers Spaces & Places |
Back to Top
Home