The Gores brothers, already seeking Starz Media, now back in hunt for Miramax
Now that exclusive negotiations between Walt Disney Co. and Ron Burkle and the Weinstein brothers to acquire Miramax Films for $625 million have collapsed, investor brothers Alec and Tom Gores could be in a position to take over two independent movie outfits.
The Gores were already in talks to acquire Starz Media, which includes film company Overture Films, animation studio Film Roman and Starz Animation and home entertainment distributor Anchor Bay. Now the siblings have restarted discussions with Disney to take control of Miramax, after their earlier bid of more than $550 million was set aside by the Burbank media giant in favor of the Burkle-backed Weinstein offer.
A Disney spokeswoman wouldn't confirm whether the company is in talks with any specific parties regarding Miramax.
Starz Media, which is owned by John Malone's Liberty Media, is seeking about $200 million, including the assumption of approximately $100 million in debt, said a person familiar with the matter.
It's not clear whether the Gores would ultimately choose to acquire both Miramax and Starz Media if talks progress, but the two assets could be complementary. Because the Miramax 611-film library doesn't come with a theatrical or home video distribution operation and the Gores have no infrastructure for producing or releasing movies, they would have to join with a strategic partner already in that business.
Overture, a producer and theatrical distributor, could make and release any new movies produced under the Miramax banner, while Anchor Bay could release new and old titles on home video. In addition, Overture has a deal to air its movies on Liberty Media's Starz pay cable channel (which is not part of Starz Media and thus wouldn't be part of a sale).
By itself, however, Starz Media has a library of only 16 films and wouldn't generate as much cash as the Miramax catalog. Anchor Bay, however, has the rights to distribute about 2,500 DVD titles.
While the Gores have been in talks with Starz, they've remained interested in Miramax from the sidelines as Disney pursued exclusive negotiations with the specialty label's founders, Bob and Harvey Weinstein.
Alec and his younger brother Tom run separate investment firms and had originally been separately pursuing a purchase of Miramax before they decided in March to team up.
Alec's The Gores Group owns radio and television programming company Westwood One, among other investments. Tom's Platinum Equity counts among its assets the San Diego Union-Tribune. At one point he also owned a stake in Lions Gate Entertainment and executive produced several films, including the 2007 thriller "I Know Who Killed Me."
Another Gores brother, Sam, runs talent agency Paradigm and has been advising Alec and Tom about their potential purchases.
The Gores bid was one of three offers for Miramax. The other bidder was an unidentified offshore company backed by construction magnate Ron Tutor and advised by troubled producer and financier David Bergstein.
Disney is also back in discussions with Bergstein, said people close to the situation.
Last week, as reported by The Times, exclusive talks with the Weinsteins ended after Disney lost patience with the brothers' inability to close the deal. One major sticking point were lingering questions over how Miramax would be integrated with the Weinsteins' current film venture, The Weinstein Co.
Three people familiar with the situation said that as Burkle and his team dove deeper into due diligence on the Miramax library, they had concerns that it was not worth the $625 million they had originally offered. A spokesman for Burkle did not respond to requests for comment.
Whoever ends up with Miramax and wants to make new installments of such franchises as "Scream" or "Scary Movie" would have to cut a deal with the Weinsteins because they have sequel rights to several titles in the library.
-- Claudia Eller, Ben Fritz and Dawn C. Chmielewski
Top photo: Alec Gores. Credit: The Gores Group.
Bottom photo: Tom Gores. Credit: Platinum Equity.