Looks like Harvey and Bob are getting Miramax back--no idea why they sold it in the first place., to be honest. From the Hollywood Reporter:
It looks as if the Weinsteins have managed to fashion a winning bid in the Miramax auction and will take back operating control of the company they founded in 1979 and sold to Disney for $80 million in 1993. Running the process internally, the Burbank studio for months has been soliciting offers for the recently shut specialty-film unit and its 611-title library. Miramax founders Harvey and Bob Weinstein had been building enough financial muscle to put together an offer of $600 million or thereabouts, seeking to top bids from such rival suitors as businessmen Alec and Tom Gores and a more controversial one from Hollywood wheeler-dealer David Bergstein.
You know, I've learned a very valuable lesson from this. When I build my 611 title library with a start up film company named after my parents, I'm never going to sell it. I'm going to give it to my children. And, their children. And, their children. No wait--forget that--then they'll just be a bunch of lazy nitwits who don't do anything but play shuffleboard and lawn bowl all day. I'll give my library to charity. Something really worthwhile like PETA, or Idol Gives Back. A film library is like an NFL team. Twenty years ago you could have given the right person a back rub, and bought the Detroit Lions for $50 million. Now a team costs a billion dollars.
If you think $600 million seems like a lot to pay,imagine being Harvey and Bob. They're sitting there right now thinking, we sold this shit 15 years ago for $80 mil, and now we're paying $600 to get it back?
Posted on 04/16/2010 2:18 PM by Todd Carr
MGM Auction Not Going Very Well
As expected, MGM was put on the block, and no one was really that willing to pony up a billion dollars, or whatever they were asking, to buy the company's assets. While there were some low ball offers, essentially, most of the action for the company is now coming in the form of financing to keep the studio making movies such as another 007, and The Hobbit. You know, movies that actually have a chance to make money. Instead of movies like Hot Tub Time Machine, that should have been made with nobodies as a straight to video for $5 million, and actually cost $50 million. Those are the kind of blunders MGM has been making for years, while they lived off revenue from their library. Well, the problem with libraries is, their aggregate value increases over time--if--big if--you can continue to effectively add to the pile. Because each individual film's value decreases over time. So, in that sense, it is essential to continue to produce winning films. Once the number of films stagnates, the value drops. This is where MGM really is right now. Like most studios, they have not been producing a lot of films the past few years--and it has been worse for MGM because of their financial troubles.
With MGMs current debt obligations, and issues meeting them, I don't expect anyone to loan the studio more money without a change in management and some institutional control. I can certainly see a hedge fund or equity firm getting involved, but I wouldn't give the current executive team $1 without veto power and some serious cost cutting measures. Films like Hot Tub Time Machine are a microcosm of what has been wrong with MGM. Too many misses, not enough hits.
Look for someone to save the studio with a financing arm--but, with some major caveats. I wouldn't want to make anything with MGM right now, other than proven franchises or sequels--Bond films and The Hobbit--until they get back on their feet.
It all might be too little, too late.
Posted on 04/07/2010 9:36 AM by Todd Carr