NBC Universal is in discussions to purchase DreamWorks SKG, several sources said Wednesday. The acquisition, potentially worth as much as $1 billion, could bring DreamWorks co-founder Steven Spielberg back into the Universal fold, where he began his career as a director, and later producer, more than 35 years ago. Universal Studios and DreamWorks already have a close relationship: DreamWorks' videos and DVDs are distributed through Universal Studios Home Video, and its films are distributed internationally by United Pictures International, the foreign distributor jointly owned by Universal and Paramount. The two studios also have co-financed individual films together such as the 2000 Oscar winner Gladiator and Spielberg's upcoming Munich, which Universal will release in December. It is not clear what form DreamWorks would take if it were to be acquired by NBC Uni, a unit of General Electric. The two companies currently duplicate efforts in areas like domestic distribution, which Universal could take over for DreamWorks. As a producing entity, DreamWorks might come to resemble Imagine Entertainment, headed by Brian Grazer and Ron Howard and based at Universal.
interesting...but
...you should really leave stuff like this for mcguff to dish...
otherwise...what good is he?
although it would be cool to see him pull an aj for his 10000 post...
kid was avg gin bout 10 a day till the big one quatro zizzle approached...
somethings up...fer ser
that would kinda suck. i like dreamworks being a major studio seperate from the existing giants of old.
Paramount Buying DreamWorks
Source: Variety December 10, 2005
Paramount Pictures has struck a deal to acquire DreamWorks SKG in a pact worth $1.5-$1.6 billion beating out rival suitor NBC Universal, reports Variety. Paramount is putting up about half the purchase price with several financial partners shouldering the rest.
Parent Viacom's board approved the transaction yesterday. A meeting today between studio head Brad Grey, 'new' Viacom CEO Tom Freston and DreamWorks SKG partner Steven Spielberg sealed the deal, says the trade.
Paramount had explored a possible bid recently but then pulled out. The idea was tabled due to the price, plus the pending, and complex, split of parent Viacom into two separate companies. Now, the split of 'new' Viacom - which houses Paramount and MTV Networks - from CBS Corporation, is all but done. The two companies will start trading separately on January 3.
Paramount will now have new product to pump through its newly independent foreign distribution network. A DreamWorks SKG purchase would include distribution of films from sister company DreamWorks Animation, plus DreamWorks SKG's 60-title library.
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this sucks. that would kinda suck. i like dreamworks being a major studio seperate from the existing giants of old. paramount needs the help but their dvd covers SUCK.
Paramount Reportedly Set to Buy DreamWorks
The $1-billion-plus deal includes a library of 60 films. Another suitor is caught off guard.
Source: Los Angeles Times
The entertainment industry was startled Friday when Paramount Pictures swooped in and struck a deal to buy DreamWorks SKG, the independent movie studio that rival NBC Universal had spent six months pursuing, according to sources close to the matter.
As recently as October, Paramount had publicly denied any interest in the acquisition after its parent company, Viacom Inc., balked at the high asking price of $1.5 billion including assumption of debt. But Viacom's board approved just such a bid Thursday, provided that outside investors help finance the deal.
As of Friday afternoon, they still hadn't lined any up, but sources said investors would be selected after the deal's announcement, which is expected as early as Sunday.
The acquisition would be a major coup for Paramount Chairman Brad Grey, the former talent manager who since being hired in March has moved aggressively to remake the struggling studio.
It also would mark the end of a dream hatched 11 years ago, when three of Hollywood's most high-profile figures — director Steven Spielberg, music mogul David Geffen and veteran studio executive Jeffrey Katzenberg — set out to build a multifaceted entertainment empire. The sale to Paramount would leave the industry with just one major independent studio: Lions Gate Entertainment.
Executives from Viacom, Paramount, DreamWorks and NBC Universal declined to comment.
Under the deal, Paramount would gain control of DreamWorks' live-action movie production operation and its relatively small, 60-title library, which includes such Oscar-winning movies as "American Beauty" and "Gladiator."
It also would give Paramount the worldwide distribution rights to all animated movies made by DreamWorks Animation, which was spun off last year to public shareholders and would not be part of the purchase.
What Paramount would be buying is a significantly pared-down version of the studio that DreamWorks' founders launched in 1994 amid media fanfare. Initially, the partners — who were heralded as "The Players" on the cover of Time magazine in 1995 — vowed to make their mark in music, film, television and the Internet in a new digital studio they planned to build near Marina del Rey.
But the partners soon abandoned plans for a sprawling studio campus at Playa Vista. And eventually, DreamWorks sold off its money-losing music label, all but shuttered its television production studio and ditched its ambitious plans for Internet and video game ventures.
Last year, the studio spun off its most successful operation: animation. Headed by Katzenberg, the unit produced such innovative computer-generated blockbusters as the "Shrek" films.
Even a scaled-down DreamWorks, however, would be a valuable addition to Paramount. It would ensure that the studio had long-lasting ties to Spielberg, one of the industry's most successful filmmakers. Although Spielberg would not exclusively direct movies for Paramount, the studio would enjoy the same arrangement DreamWorks currently has: It would own half of every film Spielberg directs for other studios.
Paramount and DreamWorks have partnered on a number of major movies, including Spielberg's hit remake "War of the Worlds" and "Saving Private Ryan." The studios have several films in the works, including a screen adaptation of the Broadway hit "Dreamgirls" — a pet project of Geffen's for 25 years — a remake of "When Worlds Collide" and a live-action version of "The Transformers," based on the popular Hasbro toys.
The potential acquisition comes at an awkward time, just as NBC Universal is preparing to release Spielberg's much-anticipated "Munich" on Dec. 23.
For Grey, who inherited the reins of Paramount from industry veteran Sherry Lansing, the acquisition of DreamWorks would help fill out the studio's thin release slate.
DreamWorks also would feed Paramount's international distribution pipeline as it dismantles its overseas partnership in United International Pictures and launches its own operation.
However, DreamWorks doesn't make as many movies as it used to. Since late 2002, the studio has produced an average of six movies a year. Its track record is decidedly mixed, including such costly misses as "The Island."
Grey is trying to revitalize Paramount, which flourished under Lansing with such profitable Oscar-winning hits as "Forrest Gump," "Braveheart" and "Titanic" before hitting a three-year slump.
Grey and his boss, Viacom co-Chief Executive Tom Freston, have been meeting in New York this week with various private equity firms that would put up the bulk of the purchase price. The pair flew back to Los Angeles late Thursday night and met Friday morning with Spielberg and Geffen to seal the deal.
When Paramount first proposed making a play for DreamWorks in October, Viacom Chairman Sumner Redstone quickly rejected the idea. He was concerned that Viacom shareholders and potential investors would balk at a time when the media giant was preparing to split into two companies.
By early January, Viacom will become two separate, publicly traded entities. The new Viacom, to be headed by Freston, will include Paramount, MTV Networks and cable channel BET. The other company, CBS Corp., will be led by Leslie Moonves, and include the CBS and UPN television networks, Paramount Television, Infinity Broadcasting and cable channel Showtime.
For some months, Redstone had told investors that Viacom did not plan to make any major acquisitions.
On Friday, analysts were surprised by a story in the Wall Street Journal saying Viacom had resurfaced as a bidder.
"It is somewhat of a communication conundrum," said analyst David Miller of Sanders Morris Harris Inc. "That style of communication never really helps stock prices in the long run."
Redstone, who was traveling overseas, was not available for comment.
Viacom is expected to contribute only about $300 million in cash and the equity partners would kick in $700 million, said one source close to the situation, who like others interviewed for this article asked to remain anonymous because the deal is pending. DreamWorks has about $500 million in debt.
Although DreamWorks had told NBC Universal about a week ago that it had another potential buyer in the wings, Universal's management was caught unaware Friday.
DreamWorks gave the brass at NBC Universal one hour to increase its offer before making a deal with Paramount. NBC refused to budge.
Geffen shrewdly played two close friends — Grey and Universal Studios Chief Ron Meyer — against each other to get the highest price for DreamWorks.
Geffen was livid when NBC Universal tentatively agreed to pay $1.5 billion for DreamWorks this summer and then, days before its exclusive negotiating window was to close, slashed its bid by about $100 million. Talks broke off but later resumed, leading Universal executives to believe they were on track to buy DreamWorks.
Many in Hollywood expected DreamWorks to end up at Universal, where Spielberg has historic ties. He has long based his production company on the studio's lot. It is the place that gave him his first break as a young director and where he made such blockbusters as "Jaws," "E.T. the Extra-Terrestrial" and the "Jurassic Park" franchise.
Viacom's Paramount Pictures announced Sunday that it has agreed to buy DreamWorks SKG, the independent film and TV studio founded 11 years ago by Steven Spielberg, Jeffrey Katzenberg and David Geffen, in a deal worth $1.6 billion in cash and debt. In order to limit its cash outlay, though, Paramount, while retaining distribution rights, plans immediately to sell the existing DreamWorks library of 59 films to other investors. Under the agreement, Paramount is acquiring all of DreamWorks' projects currently in development; DreamWorks' television division and its properties; and exclusive rights to future DreamWorks Animation TV characters in TV shows. Although the publicly traded DreamWorks Animation is not part of the deal, Paramount will take the worldwide distribution rights to its movies, currently held by the original DreamWorks, beginning in 2006 and continuing for seven years. Paramount will also sign new three-year employment contracts with Geffen, as chairman of DreamWorks, and Spielberg as a producer-director.
Studio is ready if Spielberg departs
NEW YORK -- -- Paramount Pictures is preparing for the possibility that director Steven Spielberg could leave the studio when his contract expires next year, calling the consequences "immaterial," a top executive said Tuesday.
In recent months, media reports have speculated that the Oscar-winning Spielberg, whose movies include "Jaws" and "Saving Private Ryan," has been unhappy at Paramount after the company bought the DreamWorks movie studio that he co-founded in 1994 with David Geffen and Jeffrey Katzenberg.
Paramount, which is owned by Viacom Inc., agreed to acquire DreamWorks in 2005 for $1.6 billion amid much fanfare. With the acquisition, Spielberg and Geffen agreed to stay on with Paramount through the end of 2008.
Katzenberg went on to be chief executive of publicly held DreamWorks Animation.
A departure is seen as hurting Paramount, whose recent blockbusters "Transformers" and "Blades of Glory" stemmed from DreamWorks. "Transformers," which Spielberg produced, has generated nearly $700 million at box offices globally.
But Viacom Chief Executive Philippe Dauman told investors at Goldman Sachs' Communacopia media conference in New York that Paramount's diverse portfolio of new movies would minimize any potential damage.
"Steven and his team have the right to leave if they choose at the end of next year," Dauman said. "We're planning for that."
Talk heats up over Spielberg's next move
Source: Hollywood Reporter
Hollywood studios are getting ready to wine and dine Steven Spielberg as his contract with Paramount winds down.
The filmmaker has endured a bumpy ride at Paramount, but executives at the Viacom Inc-owned studio believe they have a shot at keeping him in the fold.
Spielberg's contract actually runs until 2010, but he has the right to terminate it at year's end. While top Paramount insiders say they don't expect him to decide until the summer, a window opens May 1 on his ability to talk to other studios.
Paramount acquired Spielberg's services in 2005 when it paid $1.6 billion for DreamWorks, the studio he co-founded with David Geffen and Jeffrey Katzenberg. There's considerable consensus that while things might not have worked out as swimmingly as Spielberg had hoped, much has been done to address his most serious misgivings.
His first six months with Paramount proved a rude awakening, confidants suggest. But issues of money and, well, respect have been dealt with sufficiently to characterize the current situation as not so much Spielberg feeling driven to leave the lot as simply his wanting to take stock of what might be on offer from others. He flirted with Universal and Warner Bros. before the marriage with Paramount.
Although regularly successful with such films as "Transformers," "Blades of Glory" and "Disturbia," DreamWorks executives complained early on in their time at Paramount that they being denied sufficient development funds or enough accolades for the projects they did get going.
At one point, Spielberg and company, unhappy with an annual production fund of $300 million, got Paramount to increase it to $400 million. Then there was the subsequent move that saw Paramount demand that the press acknowledge all DreamWorks-produced films as DreamWorks/Paramount releases.
Paramount executives insist they will retain all rights to dozens of DreamWorks development titles even if he bolts, though others suggest that Spielberg could make it difficult to see key projects to completion.
Spielberg is involved in postproduction on "Indiana Jones and the Kingdom of the Crystal Skull," which Paramount will release May 22.
Of Spielberg-shepherded projects in development at Paramount, "Transformers 2" is the most important and also the most advanced. The sequel to Michael Bay's $319 million domestic grosser is in preproduction, getting a final script polish and readying for shooting in late spring.
It is set for release June 26, 2009, and terms of Spielberg's contract stipulate that it can be marketed as a DreamWorks title regardless of his relationship with Paramount at that point.
Paramount's costly DreamWorks acquisition didn't include the studio's name. DreamWorks Animation -- which wasn't a part of the deal and remains a separate, publicly traded company -- owns the DreamWorks name; its name-licensing agreement with Paramount would end the day Spielberg ends his stay there.
Meanwhile, DreamWorks chief Stacey Snider would be free to bolt Paramount in the event of a Spielberg exit under a "key man" provision in her contract; likewise DreamWorks chairman Geffen, who could be key to any effort by Spielberg to create a DreamWorks II elsewhere.
Such a DreamWorks II would no doubt be a smaller business than its progenitor, with a smaller slate and maybe no animation -- unless it were to merge with DreamWorks Animation. Insiders at the Glendale, Calif,-based firm insist that there's been zero discussion of that possibility, which is just one of many scenarios spun by industryites on the periphery of the situation.
Handicapping who might offer the most appealing terms to Spielberg puts a lot of stock in the filmmaker's longtime association with Universal, where his personal offices still are located along with those of his Amblin Entertainment shingle. Universal also has a history of working with Spielberg to develop theme-park attractions at Universal Studios.