Would Miramax + Overture = new mini-major?

05.26.10 9 years ago

There is a lot of nervousness in the specialty business these days.  Besides the stable confines of Fox Searchlight, Focus Features and Sony Pictures Classics, there haven’t been many consistent distributors of independent or prestige films over the past decade.  Sure, IFC Films and Magnolia Films have carved their own niche, but they don’t really serve as a launching point for crossing over to mainstream popularity let alone profitability for indie financiers. Instead, the list of failed or abandoned outfits includes Paramount Vantage, Warner Independent, Picturehouse, Fine Line and First Look.  But, could a possible merger between two other unwanted outfits change all that?

The news this week that the Weinsteins and investor Ron Burkle had failed in their attempts to secure the Miramax name and library from the Walt Disney Company was viewed as disappointing for those who’d hoped the brothers could bring some glory back to their former startup (something they’ve barely been able to do with The Weinstein Company).  Unfortunately, the deal fell apart for a variety of reasons and there may have been some misunderstanding amongst the industry that the duo were never going to be able to merge Miramax, which pretty much no staff at the moment, and TWC.  It would be too complex mostly because both labels would have a completely different set of investors leading to the Weinsteins running two different companies at the same time (not a fun prospect).  Now, Disney is reportedly having casual conversations with Tom and Alec Gores who had originally underbid just $550 million for the unit, to see if they are a true player for the brand and library.  Disney originally wanted $700 million for Miramax (Burkle and the Weinsteins were offering $625 million) and is sending signals they are in no rush to sell if the price isn’t right.  For the Gores, however, Miramax could be an excellent opportunity of what could be a larger strategy.

The two billionaire brothers have already discussed acquiring relatively new outfit Overture Films (“The Visitor”) from Liberty owned Starz Media.  Overture doesn’t have much of a film library like Miramax, but it has a distribution deal set up through its Anchor Bay division and a savvy marketing staff that just started to hit its stride when Liberty put the breaks on further development and  acquisitions.  If the Gores could acquire both companies, they could re-launch a new “Miramax” with an experienced operating staff, a library to exploit and the financial means to fund new pictures (what’s $500 million between friends when you’re a billionaire?) relatively quickly.  Considering how fast Apparition was able to come into the marketplace over the past year with solid hits such as “Young Victoria” and “Bright Star”(anyone who thinks that was a loss is kidding themselves), it’s clear an invigorated “Miramax” could easily find and produce quality product to a willing audience.

Whether the Gores can strike a deal with Disney remains to be seen.  They are clearly the richest buyers out there, but the studio is wary over the price (it can’t look like they got swindled to the stockholders).  Of course, this pundit thinks the Mouse House is making a huge mistake getting rid of the property and library in the long term — one they will come to regret, but that’s a discussion for another day. 

In the meantime, both Miramax and Overture will stagger along with the few releases left on their schedule.  Disney marketing and distribution is handling the release of “The Switch” starring Jennifer Aniston and Jason Bateman in August.  Overture is prepping the dramatic thriller “Let Me In” for October.  What happens at that point is anyone’s guess, but the Gores will be waiting.

For the latest entertainment commentary and breaking news year round, follow Gregory Ellwood on Twitter @HitFixGregory .

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