DreamWorks announced today that they've found the first phase of funding for their new studio, partnering with Reliance Anil Dhirubhai Ambani Group to close the deal. Walt Disney Studios will now handle the marketing and distribution for the studio. Here is the official release:
Anil Dhirubhai Ambani, chairman of the Reliance Anil Dhirubhai Ambani Group, the parent company of Reliance Big Entertainment and Reliance BIG Pictures along with Steven Spielberg and Stacey Snider, the principal partners of DreamWorks Studios jointly announced today the completion of the first phase of funding for their new motion picture company, based in Los Angeles, California. They further announced that J.P. Morgan Securities arranged the syndication of approximately $325 million of senior debt, which Reliance Big Entertainment is matching with its equity commitment. The Walt Disney Studios, who will handle marketing and distribution for the studio, will also extend a loan to DreamWorks as part of the distribution deal.
The debt financing was led by J.P. Morgan, who brought together other lenders to set-up DreamWorks with its first wave of funds. Participants include: Bank of America, City National Bank, Wells Fargo, Comerica, Union Bank of California, SunTrust, California Bank & Trust, and Israel Discount Bank.
Anil Ambani said: "Our partnership with Stacey and Steven is the cornerstone of our Hollywood strategy as we grow our film interests across the globe. Given our faith in the business plan that they presented to us and despite the current economic climate, we were always confident that this day would come. Now Stacey and Steven can focus on producing more of the great films for which they are renowned."
"This will allow us to move ahead quickly into production with our first group of films," said Stacey Snider and Steven Spielberg in a joint statement. "We wish to thank Anil personally for his foresight and fortitude over the past months. We congratulate J.P. Morgan for their leadership in attracting this funding during today's most challenging financial environment. Our thanks also to our distribution partner Disney who we look forward to working with in getting our movies out to the global audience."
Joining Stacey Snider and Steven Spielberg on DreamWorks' Board of Directors on behalf of the Reliance ADA Group are Amitabh Jhunjhunwala, Vice Chairman, Reliance Capital, and J.P. Morgan's Alan J. Levine.
Alan J. Levine of J.P. Morgan Entertainment Advisors led the Reliance team in structuring the capital and business plan for the company. Schuyler Moore at Stroock & Stroock & Lavan was Reliance's counsel. DreamWorks was advised by Skip Brittenham at Ziffren Brittenham LLP, Bruce Ramer and Harold Brown at Gang, Tyre, Ramer & Brown, and Cravath, Swaine & Moore. John Miller and David Shaheen at J.P. Morgan Securities led the senior debt syndication.
"It took great dedication over many months to turn our vision for this company into a reality," said Jeff Small, President and Chief Operating Officer of DreamWorks Studios. "The time spent by everyone navigating the changing economic waters allowed us to make the most responsible deal for DreamWorks and ensure that our partnership with Reliance, from the very beginning, was built on solid ground. We appreciate the faith our bank group has in our business plan and look forward to a long and fruitful relationship with them."
DreamWorks has a long-term distribution deal with The Walt Disney Studios, which will market and distribute approximately six live-action films a year for the company, except for India where Reliance Big Entertainment will retain distribution rights. The first release under Disney's Touchstone banner is expected in 2010.