Lions Gate regains vid rights
Co. to control distrib'n on theatrical releases
Although a four-year deal in which Lions Gate paid U a fee to handle distribution of selected Lions Gate theatrical releases expired in the fall, Lions Gate had already begun taking over distribution of its pics "Monster's Ball," "Frailty" and "The Wash," among others.
Regaining rights controlled by U on previous releases will allow Lions Gate to fully capitalize on the company's growing library through repriced DVD re-releases, according to CEO Jon Feltheimer. He estimated the company would realize an extra $25 million from the buyback over the next four or five years. Just as important, Lions Gate will control all video distribution on all its theatrical releases going forward.
"This will be one more building block in rounding out our company as a fully diversified distributor with the capacity to drive product from its core businesses through the entire value chain," Feltheimer said.
Slim success
He praised the lean video unit headed by Peter Block for its demonstrated ability to successfully market hit theatrical releases, led by "Monster's Ball" last year. "The results that Peter and his lieutenant Ron Schwartz have created for our theatrical product this year give us confidence that this will be an extremely accretive transaction."
Lions Gate has built a filmed entertainment library of more than 2,000 titles over the past two years and adds more than 100 titles annually. The library generated $150 million in 2002.
