Sadly this picture will never become reality. Disney has reportedly sold Miramax, who holds a film library between 600-700 films, to construction executive Ronald Tutor and Colony Capital, a privately held investment firm run by founder/CEO Thomas Barrack Jr and David Bergstein. It’s not a done deal, but an agreement in principle has reportedly been made*
Tutor and Colony have committed $300 million in equity with an addition capital to be raised by minority partners: James Robinson (chairman of Morgan Creek Prods) and Gulf Capital, an investment firm based in Abu Dhabi. Bergstein is a controversial figure involved in various lawsuits over the closure of ThinkFilm and his other companies. That still leaves about $200 million to be raised in the form of debt. According to thewrap.com the breakdown of the sale is $250 million in accounts receivable, $50 million in current cash. Once the receivables come in - which should take five years - the sale price will be under $400 million.
This ends the long-sought attempt by former owners Bob and Harvey Weinstein from re-acquiring the company they formed and the name based on their parents: Miriam and Max. It’s easy to see why this is thought to be a crushing disappointment to the pair of brothers. Their backer, L.A. billionaire Ron Burkle balked at the purchase price. Lionsgate was reportedly another suitor hoping to acquire the studio that brought us films like Pulp Fiction and Shakespeare in Love and Chicago.
Tutor intends to run Miramax as a standalone company reportedly issuing new theatrical releases as well as the film library. Bergstein is expected to take on a prominent advisory role. Morgan Creek, run by Jim Robinson, would be a distribution partner for the new Miramax, also putting capital into making the deal happen.
The deal is not expected to be finalized until the end of July, with broad outlines agreed-upon by both sides. Disney would not comment until a deal was closed. One rival bidder suggest the deal would not happen at $675 million.
Disney pretty much shut down Miramax last year, essentially selling it’s library films alone with no new products on the market. Experts on the value believe Miramax could generate up to $350 annually in cash flow, but shouldn’t be valued at any more than $500 because of declining DVD sales and rentals.