Colony Capital joins Tutor's Miramax bid as part of move into entertainment [updated]
Signaling a move for a major Los Angeles investment firm into the entertainment business, Colony Capital has joined Ron Tutor's bid to acquire Miramax Films from Walt Disney Co.
Negotiations are now being handled by Colony principal Richard Nanula, a former chief financial officer for Disney, a person close to the situation confirmed. Another person noted that Colony Chief Executive Thomas J. Barrack Jr. and principal Justin Chang, who recently moved from TPG Capital and whose investments include film studio Metro-Goldwyn-Mayer Inc., are closely involved in the negotiations as well.
Troubled film financier David Bergstein remains on Tutor's team as well, though he is not putting up money of his own, and it's not clear what role he would play for Miramax if the offer is successful.
Colony and Tutor's bid is said by a person familiar with the matter to be in the range of $600 million to $700 million. It's not known how much of that total would come from each of the investors.
Disney came very close to selling its independent film division Miramax to supermarket magnate Ron Burkle, who was working with Miramax founders Bob and Harvey Weinstein, for $625 million, but that deal fell apart in May. In June, Tutor entered exclusive negotiations with Disney for Miramax. He had previously made a bid in April.
Colony's decision to get involved in the Miramax bid signals that the firm, which has previously had little involvement in the media business outside of a deal involving British move theater chain Virgin Cinema in the 1990s, is moving into the sector now. A person familiar with the situation said that despite many investors' pessimism toward Hollywood due to falling DVD sales and the declining value of libraries, Colony believes some entertainment assets now may be undervalued.
-- Ben Fritz and Dawn C. Chmielewski