Sources: JP Morgan raises financing to pay for rollout of digital cinema
Lifting a roadblock to the rollout of 3-D in theaters, investment firm JP Morgan has raised nearly $700 million to finance the digital conversion of thousands of screens around the country, three people familiar with the matter said Friday.
The funding, delayed for longer than a year due to the credit crunch, would pay for the installation of digital projectors for about 12,000 screens, easing a bottleneck caused by an abundance of 3-D movies competing for not enough screens. There are currently only about 3,500 digital 3-D screens in the country.
The shortage of screens has created tensions between studios as they muscle each other to get their 3-D pictures into theaters. Warner Bros.' "Clash of the Titans," for example, is set open a week after DreamWorks Animation Studios releases its next animated movie, "How to Train Your Dragon" on March 26. Those movies also will compete for screens with Disney's "Alice in Wonderland," which premieres March 5.
The funding, expected to be formally announced in the next two weeks after studios sign off on the deal, comes nearly three years after the nation's largest exhibitors -- AMC, Cinemark and Regal -- formed a consortium know as Digital Cinema Implementation Partners to pay for the digital conversion of theaters.
In 2008, the group said it reached an agreement with five studios to raise $1 billion toward retrofitting theaters. The funding would be secured through so-called virtual print fees.
-- Richard Verrier