Miramax deal no longer includes James Robinson, Jerome Swartz as potential investors
Morgan Creek Prods. founder James Robinson, who had been in negotiations to become a major investor in the acquisition of Miramax Films along with construction magnate Ron Tutor and Los Angeles private equity firm Colony Capital, is no longer part of the mix.
Robinson was prepared to put up $75 million to $100 million of the $660-million purchase price for Miramax, for which the Tutor-Colony led investor group Filmyard Holding signed a definitive agreement to purchase from the Walt Disney Co. in late July. As part of the deal, Robinson's production company Morgan Creek was to sell Miramax's movies overseas.
With Robinson out of the picture, Tutor and Colony will now have to either pony more of their own money or find other investors to make up the equity gap. Another potential investor in the Miramax deal, retired engineer and philanthropist Jerome Swartz, who as previously reported was expected to invest between $25 million and $50 million, has also pulled out of talks, Tutor said.
Swartz did not respond to requests for comment.
Negotiations between Robinson and Tutor broke down largely over issues of managerial control and the length of time that Morgan Creek would handle the foreign distribution of Miramax's movies, according to people with knowledge of the talks. They said Robinson had expected to be an equal partner with Tutor and run day-to-day operations of Miramax, but that Tutor and Colony objected.
Robinson and Tutor confirmed that their potential deal collapsed, but declined to elaborate on the reasons.
"At the end of the day, the deal we thought we had we didn't have," said Robinson. "Because of that, we're no longer involved in Miramax with Colony and Ron Tutor."
Tutor, who along with Colony had each originally agreed to put up $100 million, said "We couldn't agree on virtually any of the terms of his participation."
With Robinson out of the picture, Tutor and Colony will now have either to contribute more of their own money or find other investors to make up the equity gap.
"We're moving ahead and if it means putting up more of our money or finding more investors, we're going to close," said Tutor, who along with Colony has put down a $40 million non-refundable cash deposit on Miramax with plans to complete the financing by early December.
Colony principal Richard Nanula, a former chief financial officer at Disney, is expected to oversee the company on behalf of the investors and hire a Hollywood executive to manage daily operations. The new owners plan to produce a few films a year to refresh Miramax's library of 700 titles, which include the independent hits "Shakespeare in Love," "Pulp Fiction" and "Chicago."