Producers revert to Initial plan
Move frees up $40 mil, saves costs for Intermedia
Initial will no longer be a subsidiary of Intermedia, which is headed by chairman Moritz Borman. Initial will also retain its name and library.
According to Intermedia, the transaction will free about $40 million that would have been due Initial in the near future. It will also see Intermedia save overhead and development costs of about $6.5 million.
Intermedia closed a deal to acquire Initial in 2001. The financing, sales and production shingle operated as an autonomous label within Intermedia, which covered its overhead and development.
Intermedia does not retain foreign sales rights on Initial's upcoming pictures, which include Martin Scorsese's "The Aviator," Rebecca Miller's "Rose and the Snake" and Lasse Hallstrom's "An Unfinished Life." However, Intermedia will have profit participation and will receive some financial overages on pics produced under the deal.
Intermedia's German-based IMF fund invested in "Aviator."
"The market has changed since we first did the deal, and this is a positive way to keep going," said King. "We hope to work together again in the future, and in today's economic climate, it was a deal that made sense to Moritz and myself."
Added Borman: "Going forward, this doesn't have any impact on Intermedia's operations as Initial always made the movies it wanted to make. When we acquired Initial, we never acquired it to integrate its library or personnel into the company."
King most recently produced "Aviator," starring Leonardo DiCaprio, which is skedded for release later this year. Initial also acted as the international distributor on Intermedia's "Laws of Attraction," being released domestically by New Line.
Intermedia's "Alexander," directed by Oliver Stone, stars Colin Farrell and will be released domestically by Warner Bros. Pictures.
