Village Roadshow falls short on funds

Film unit unable to deliver its share on four pics

By PAMELA MCCLINTOCK

Village Roadshow Pictures was unable, because of the credit crisis, to come through with the financing for the last four films it partnered on with Warner Bros., leaving the studio to cover at least $120 million in costs.

Time Warner disclosed Roadshow's funding crunch in its quarterly earnings report, issued Wednesday.

Australian company Roadshow has been Warners' co-financing partner since 1998. It's helped fund a long list of titles, including the "Matrix" franchise. The four films it was to have helped finance, but couldn't, were "Get Smart," "Gran Torino," "Nights in Rodanthe" and "Yes Man."

"Get Smart," "Torino" and "Rodanthe" were all box office successes, grossing north of $220 million worldwide. Among the films that Eastwood has directed, "Torino" is his biggest hit.

A Roadshow source said the company is in the process of restructuring its debt, and that it expects to secure a new line of credit as soon as the next two weeks.

Time Warner's earnings report suggested it was "unsure whether this co-financing partner will ultimately secure the funding for amounts due on these four 2008 productions or the funding it had committed for films slated for release in 2009. The difficulties in the credit market may also reduce the company's ability to attract other financial partners to co-finance its films."

Warner Bros. said the SEC requires such language, but that the studio isn't concerned about whether Roadshow will be able to meet its ongoing commitments.

"This is a temporary restructuring issue and we fully expect our partner to ultimately secure funding. At the end of the day, we make movies with partners and we make movies without partners. This is simply an issue of the times we're in," the studio said in a statement.

Warners and Village Roadshow are partners on the upcoming films "Sherlock Holmes" and "Where the Wild Things Are."

Village Roadshow's troubles come at a dicey time for the majors, who have come to rely on co-financing partners for the vast majority of their projects.

Warners' other major co-financing partner is Legendary Pictures.