In a major development for the adult entertainment industry, German hedge fund manager Prime Capital AG has acquired a 26.83% stake in Frankfurt listed, Zug, Switzerland based adult content producer tmc Content Group AG. With over €14 billion under management, Prime Capital AG, under its new CEO, Andreas Kalusche, has become the leading investor in European erotic content.
This investment by Prime Capital fund manager Andreas Jaufer marks an increase in Prime Capital’s already significant presence in the hardcore market following his acquisition of German erotic lifestyle retailer Beate Uhse.
Sources at tmc suggest that Prime Capital may wish to increase its involvement in the business through Board representation and have called an Extraordinary General Meeting with this goal. With most asset managers avoiding the pornography and hardcore lifestyle markets, this is a substantial development in the market. Sources further suggest that Prime Capital’s support will allow tmc to substantially increase its production of adult movies in Germany and Eastern Europe.
Industry sources are quick to point out that this investment is a departure from investment strategies by most funds, which are squeamish about the negative publicity surrounding adult entertainment in the current progressive #METOO environment and concerns over US legislation, including FOSTA-SESTA. Expectations are that Prime Capital’s contrarian strategy will encourage other funds to take advantage of the potential return from adult movie making.