Arnon Milchan's New Regency Productions and Fox extend longtime partnership
Arnon Milchan's production company New Regency Productions and News Corp.'s Fox Filmed Entertainment have struck a deal to extend their longtime partnership through 2022, while at the same time providing a more active role for New Regency in Fox's releases.
Going forward, New Regency will develop and fully finance a larger number of its films, which Fox will continue to distribute in theaters and on DVD. That enables New Regency to have more say over projects while still enlisting Fox's worldwide marketing and distribution system. Meanwhile, Fox benefits by the flow of movies from the independent production company and reduces its financial risk.
"This is great for both sides," said Fox Co-Chairman Jim Gianopulos. "It allows New Regency to keep the upside on more films and it augments our ongoing slate of 16 to 18 movies a year."
Among the projects currently in the works are sequels to "Big Momma's House" and "Alvin and the Chipmunks"; a thriller called "Now," starring Justin Timberlake; and "What's Your Number," an "edgy" comedy starring Anna Faris and Chris Evans.
Over the last 13 years, the closely aligned companies have collaborated on 55 movies, including the breakout hits "Marley & Me," "Mr. and Mrs. Smith" and the "Alvin and the Chipmunks" film series as well as less successful offerings such as "Marmaduke," "Love and Other Drugs" and "Meet Dave."
New Regency -- in which News Corp. owns a 20% stake -- has co-financed about three-quarters of the movies it has made with Fox while fully financing the balance.
Since Hutch Parker, a former Fox executive, joined his former studio colleague Bob Harper at New Regency in 2008, the co-chairmen have been stepping up production and now plan to make five to seven pictures annually, up from three or four.
"This deal is shifting the balance," Parker said. "We'll be co-financing fewer films and making more on our own. This will allow us to be more maverick and take more creative risks."
Harper said that New Regency was well positioned to finance more movies, in large part because Milchan is able to use the company's library of 110 movies that he's assembled over the last 25 years -- which also includes "JFK," "Free Willy" and "Pretty Woman" -- as collatoral to obtain bank loans.
"We have a very substantial bank facility," led by JPMorgan, noted Harper.
The continuation of its partnership with Fox for nine additional years from the expiration of its existing pact in 2013 is also good news for Hollywood's independent producers who are finding it increasingly difficult to obtain financing to make movies due to studios cutting back the number of films they release.
One of the movie industry's biggest co-financiers, Spyglass Entertainment, is disappearing as a funding source since its principals, Gary Barber and Roger Birnbaum, have recently taken over the management of the newly restructured MGM.
"In a climate where resources are harder to come by for filmmakers, this extension says this machine is going to stay in place and be financed," Harper said.
Harper and Parker also said they were exploring plans this year to return New Regency to the television business. Despite such past successes as "Malcolm in the Middle," the company bowed out of the TV business in 2008 amid a changing landscape and tougher economics. "We can see an opportunity for a restructured approach," Parker said.
Milchan relocated New Regency from Warner Bros. to Fox in 1998 after News Corp. agreed to make a $200-million equity investment in the company. Over the years, Milchan also has held interests in business unrelated to movies and TV, including German sporting-goods giant Puma, in which he sold his shares to Goldman Sachs in 2003.
-- Claudia Eller
Photo: New Regency founder Arnon Milchan. Credit: New Regency