Posted on 03/19/2006 6:41:09 PM PST by AmericanMade1776
NEW YORK -- Entertainment company Viacom Inc. said Friday it agreed to sell the film library of the recently acquired DreamWorks studio to an investment group led by financier George Soros in a deal that values the library at $900 million.
The 59 films in the library include "Gladiator," "American Beauty" and "Saving Private Ryan."
Viacom, which recently split off its broadcasting and publishing assets into separately traded CBS Corp., said the deal will complete the second stage of its acquisition of DreamWorks SKG Inc., the studio founded by director Steven Spielberg, producer David Geffen and former Walt Disney Co. executive Jeffrey Katzenberg.
The buyers are Soros Strategic Partners LP and Dune Entertainment II LLC.
Soros and Dune will acquire all 59 DreamWorks live action films released through Sept. 15 of last year, while Soros will distribute the library through an exclusive five-year agreement with Paramount, the company said.
(Excerpt) Read more at newsmax.com ...
DreamWorks, L.L.C., doing business as DreamWorks SKG, is a Big Ten studio in the United States of America which develops, produces, and distributes films, video games, and television programming. It began as an ambitious attempt by media moguls David Geffen, Jeffrey Katzenberg, and Steven Spielberg to create a new Hollywood studio, but in December 2005, the founders agreed to sell the studio to Viacom, Paramount Pictures's parent. Its animation subsidiary, DreamWorks Animation SKG, will remain independent, but its films will be distributed worldwide by Paramount Pictures. Paramount completed the acquisition in February 2006
I guess we can file this one under WGAS?
This is a list of DreamWorks productions as of 2005.
[edit]
1997
Dear Diary
The Peacemaker
Mouse Hunt
Amistad
[edit]
1998
Antz
Deep Impact
Paulie
The Prince of Egypt
Saving Private Ryan
Small Soldiers
[edit]
1999
American Beauty
Forces of Nature
Galaxy Quest
The Haunting
In Dreams
The Love Letter
[edit]
2000
Almost Famous (With Sony Pictures)
Cast Away (With 20th Century Fox)
Chicken Run
An Everlasting Piece
Gladiator (With Universal)
Joseph: King of Dreams
Lucky Numbers
Meet the Parents (With Universal)
The Road to El Dorado
Road Trip
Walk the Talk
What Lies Beneath (With 20th Century Fox)
[edit]
2001
Artificial Intelligence: AI (With Warner Bros.)
A Beautiful Mind (With Universal)
Evolution (With Sony Pictures)
The Curse of the Jade Scorpion
The Last Castle
The Mexican
Shrek (plus a sequel in 2004 and an upcoming sequel in 2007)
[edit]
2002
Catch Me If You Can
Hollywood Ending
Minority Report (With 20th Century Fox)
The Ring
Road to Perdition (With 20th Century Fox)
Spirit: Stallion of the Cimarron
The Time Machine (With Warner Bros.)
Tuxedo, The
[edit]
2003
Anything Else
Biker Boyz
The Cat in the Hat (With Universal)
Head of State
House of Sand and Fog
Old School
Paycheck
Seabiscuit (With Buena Vista and Universal)
Sinbad: Legend of the Seven Seas
[edit]
2004
The Assumption
Anchorman
Collateral (With Paramount)
Envy
Eurotrip
Lemony Snicket's A Series of Unfortunate Events (With Paramount and Nickelodeon Movies)
Meet the Fockers (With Universal)
Shark Tale
The Stepford Wives (With Paramount) (remake of 1975 film)
Surviving Christmas
The Terminal
Win a Date with Tad Hamilton!
Shrek 2
[edit]
2005
Wallace & Gromit: The Curse of the Were-Rabbit
The Island (With Warner Bros.)
Just Like Heaven
Madagascar
Red Eye
The Ring Two
Dreamer
The Prize Winner of Defiance, Ohio
War of the Worlds (With Paramount)
The Madagascar Penguins in a Christmas Caper
Memoirs of a Geisha
Match Point
Munich
[edit]
2006
She's the Man
Over the Hedge
Flushed Away
There is a few diamonds in that list, but a lot of it is horrible junk that bombed at the box office.
Hope Soros takes a loss on this investment in the long run.
Almost no bombs, actually. Dreamworks is now the gold standard in the film industry. It limited the number of films it made and released, and anything "iffy" was made on tight budgets to limit potential loses. The only outright bomb they made was 'The Island', and they stuck Warner Bros. with half the loss thru a cross financing deal, because they didnt trust Director Michael Bay to deliver without Jerry Bruckheimer producing, which was a good call.
-- The financier seems to be taking a big risk by paying $900 million for the DreamWorks live-action film library
No one will ever accuse George Soros of being a financial fool. And we're not going to start now. But you have to scratch your head a bit and wonder what the legendary 75-year-old financier was thinking when he signed the deal, announced by Viacom on Mar.17, to pony up $900 million to buy 59 films distributed by DreamWorks SKG.
Viacom's (VIA ) Paramount Pictures acquired the library as part of its $1.5 billion acquisition of the DreamWorks live-action studio in mid-December. As part of that deal, Paramount also won the rights to distribute DreamWorks' animated films, which the publicly traded company DreamWorks Animation SKG (DWA ) will continue to produce on its own. The films that Soros and private-equity firm Dune Entertainment II are acquiring are hardly shabby. Among them are Academy Award winners American Beauty and Saving Private Ryan, Steven Spielberg's gripping World War II drama. Of course, there are also some bona fide losers, including last year's megabomb The Island, and the 2004 yawner Win a Date with Tad Hamilton. On top of that, DreamWorks shares the rights to some of its movies. Universal is partner on Meet the Fockers and Seabiscuit, while Fox is a collaborator on Road to Perdition.
So how much cash flow does a library of 59 films generate, especially since many of the films have already been through their most lucrative "windows" -- such as sales of DVDs and showings on pay TV? By comparison, MGM, with more than 4,000 titles, generated cash flow north of $200 million last year for its older and less successful library.
MUSIC KICKER. So maybe there is $75 million a year of cash flow left in DreamWorks' much smaller lineup. Paramount certainly had the confidence to drive a hard bargain, according to those with knowledge of the deal, obliging Soros to return with a sweetened offer after studio rejected his first bid. According to the deal announcement, Soros signed a five-year distribution deal for Paramount to continue to sell the films to new buyers. Paramount gets an estimated 8% of the revenue as its fee, further cutting Soros' cash flow. On top of that, Paramount retains the music-publishing rights for songs from the movies and "certain other ancillary" rights. The kicker is that Paramount also has the rights to make any sequels as well as "derivative rights" -- meaning TV shows, if any develop -- and merchandising rights.
In short, what exactly does Soros get? He seems to have bought an asset on the downside of its life and given up at least some of the upside. What he's clearly banking on is that the new worlds of digital distribution -- through everything from Apple's (AAPL )video iPods to cable TV video on demand -- will jump-start cash flow with new markets for spent product. It has worked before, of course, as folks rushed out to buy older films on DVD. Still, Soros may be figuring that he can get out if things don't pan out. Under the arrangement, he can sell the library back to Viacom in five years at whatever the market value might be at that time.
"This transaction materially increases our expected return on invested capital for the DreamWorks acquisition," said Viacom Chief Financial Officer Michael Dolan, who structured the deal. "Additionally, we retain all the strategic and operational benefits of the combination." In short, it's a win-win for Viacom. It pays down its costs of buying DreamWorks in December, and Viacom has a seat at the table if digital distribution starts to take hold. As for Soros, you have to hope he's a big fan of old movies.
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Article Feedback Comment: Review: I think this would be a wonderful purchase for Soros. It would allow me to have a complete list of his movie assets. That way, I would know exactly which ones to avoid in response to his crazy Communist anti-American antics. Any damage this might also cause to the pocketbooks of the looney Hollywood Left would just be a bonus.
http://yahoo.businessweek.com/bwdaily/dnflash/mar2006/nf20060320_5312_db016.htm
Posted for FlAttorney by MAR
Glad I bought my copy of Saving Private Ryan 2 years ago.
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