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12-10-2005, 10:30 PM
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#1 of 7 
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Quote:
Moving swiftly after negotiations bogged down with a rival, Viacom Inc. closed a deal on Friday to pay $1.6 billion for DreamWorks SKG, the Hollywood studio founded by Steven Spielberg, Jeffrey Katzenberg and David Geffen, according to an executives involved in the negotiations.
Viacom and its studio division, Paramount Pictures, sealed the acquisition at a meeting on Friday between Mr. Geffen, Mr. Spielberg, Tom Freston, Viacom's chief executive, and Brad Grey, Paramount's chairman. More than half of the money will come from private equity investors, the executives involved in the talks said, and the price includes the assumption of about $400 million in DreamWorks' debt.
DreamWorks had been in advanced talks with General Electric's NBC-Universal, but told Universal on Friday that if it could not meet Viacom's price, DreamWorks would break off negotiations, according to an executive close to those discussions. Shortly thereafter DreamWorks confirmed the purchase by Viacom.
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This comes as a huge surprise to me, actually; since Dreamworks has been parked at Universals since its inception I thought Uni would be the natural one to pick it up if it ever decided to stop being independent.
It certainly bodes well for an "Indy 4", should the script ever materialize, however.
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12-11-2005, 06:08 PM
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#2 of 7
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Member
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I had noticed that Dreamwork's has had a few flops recently...but $400 million isn't that much in todays film market, I guess they weren't doing that bad.
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12-12-2005, 04:49 AM
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#3 of 7
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Parker Clack
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I am really surprised by this too. I heard that NBC/Universal had bid on the company earlier and that never went over.
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12-12-2005, 12:27 PM
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#4 of 7
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Michael Reuben
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Today's NYTimes has a good article recounting the history of negotations. The thrust of the article is that GE/Universal took too long to make a deal and alienated the Dreamworks principals with too much dickering (notably, dropping the purchase price after disappointing box office for The Island and Almost Heaven).
http://www.nytimes.com/2005/12/12/bu...reamworks.html
M.
"Most people never have to face the fact that, at the right time and the right place, they're capable of anything." -- Chinatown
"What kind of movies would there be if everyone in them had to do what we thought they should do?" -- Roger Ebert
HTF Beginner's Primer and FAQ
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02-02-2006, 02:49 AM
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#5 of 7
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Changes at the top in Paramount:
http://www.videobusiness.com/article/CA6304175.html
Quote:
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Following its announcement that it had closed the DreamWorks acquisition so quickly, Paramount said it was “well along in the process” to selling the DreamWorks library. As part of its deal to buy the company, Paramount will sell off DreamWorks’ 59-title library. The studio will continue to distribute the library. Paramount also will distribute titles through 2012 for DreamWorks Animation, which remains a separate company.
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Why on earth would a studio buy another one only to sell off its library immediately? |
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02-02-2006, 08:17 AM
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#6 of 7
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To make up some money back from the acquisition. They aren't selling the library to another studio, they're selling it to a financial consotrtium (old guys with money but no ties to studios) and then retaining the distribution rights. Basically, the consortium is making an investment and getting money back on the revenues generated by the library, and Paramount is keeping a distribution fee for putting the movies out on DVD, TV, etc.
After the distribution agreement is over, the consortium can sell the movies back to Paramount or find another studio to distribute them depending on the deal they sign now.
"If you write a story about a soldier going AWOL and kidnapping a pregnant woman and finally shooting her in the head, it's called searingly realistic, even though it's never happened in the history of mankind. Whereas if you write about two people falling in love, which happens about a million times a day all over the world, for some reason or another, you're accused of writing something unrealistic and sentimental."
-Richard Curtis, Screenwriter and Director
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02-03-2006, 05:28 AM
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#7 of 7
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I see. Thanks for the explanation, Chad.
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