MGM and Weinstein set to roar again
13-Mar-2006 • Bond News
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It looks like two Hollywood legends are due for a comeback. Harvey Weinstein, the flamboyant, Oscar-dominating, often despised co-founder of Miramax Films, is set to ink a deal to make movies for MGM Studios, sources in Hollywood and close to MGM confirm.
The deal, which could be announced as early as Wednesday, Mar. 8, will raise eyebrows in Hollywood on two separate scores. First, it will mean a new, high-profile home for Harvey and his brother, Bob, who had a nasty 2005 divorce from Disney, which had bought Miramax in 1993. The split left the two without a big studio backer -- and the famed Miramax name. The pact will also signal legendary studio MGM's return to making and distributing films.
MGM, owner of a rich library and the rights to such classic franchises as the Pink Panther and James Bond films, was sold in 2004 to a consortium led by Sony. Many in Hollywood figured that with the exception of the library and franchises, the consortium has little interest in the famous name and that the studio would cease to operate.
However, sources say industry veteran Harry Sloan, MGM's new CEO, will announce MGM's resurgence as a full-fledged studio at a press conference on Mar. 8. Initially, MGM is expected to concentrate on producing and releasing smaller-budget, independent-style films and allow Sony to distribute its larger movies, such as the next James Bond flick, which the two studios will co-produce.
Sony released MGM's latest movie, the Steve Martin prequel to the Pink Panther series, which has grossed more than $70 million since its Feb. 19 debut. The movie had been greenlighted before the 2004 sale and was expected to be one of MGM's last flicks. Sloan has been telling Hollywood insiders that MGM, which has a library of 4,000 titles and 10,000 episodes of TV shows, is eager to "freshen up" the collection with newer titles as the world goes digital and new outlets such as video-on-demand for foreign cable channels are popping up.
Jumpstarting the movie-making part of MGM is where the Weinsteins come in. The duo have been busy raising money for their new studio, The Weinstein Company, since their departure from Disney. The Weinsteins have already begun releasing flicks, including the modest hits Mrs. Henderson Presents and Derailed.
With Goldman Sachs as their bankers, the brothers have raised more than $600 million in debt and equity but need the added clout of a film studio. The Weinsteins have yet to sign a deal with a pay-television outlet, and could use MGM's clout in distributing their films to TV stations as well, say sources close to the brothers. For example, MGM has a deal with premium cable channel Showtime.
How many films the Weinsteins will produce for MGM is still unclear, and MGM will also be producing its own movies, say sources with knowledge of the MGM plans. MGM also intends to sign on other producers besides the Weinsteins to make films that it will distribute, according to sources close to MGM.
Ironically, the plans for a revitalized MGM could leave Sony out in the cold, according to several Hollywood sources with knowledge of the situation. Sony owns 20% of MGM and has the rights for the next year or so to release films from MGM's library of more than 4,000 titles. That was considered a crucial part of the deal for Sony, as it meant the electronics company could use the content to help push adoption of its next-generation high-definition DVD, Blu-ray, which is competing with a second format.
But the majority of MGM is owned by a consortium that includes cable giant Comcast. Leading the move to rev up MGM are private equity firms Providence Equity Partners and Texas Pacific Partners, which combined own 50% of MGM. The private equity firms are believed to want to beef up MGM to prompt a sale to another buyer, which might include Comcast. The cable company has said it wants to secure more content so it can lure subscribers with free movies on demand.
MGM would not comment for this story.
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