In a story from The Hollywood Reporter, as the deal between Ronald Tutor and investment group Colony Capital to buy Miramax Films for more than $650 million gets closer to completion, it now looks like Disney will handle domestic distribution of "any new Miramax titles for at least its first year, after which the new company would have its own infrastructure."
Tutor is presently seeking an executive to head the new company, which will be created from the ground up.
Wednesday was supposed to be the deadline to serve up a $40 million nonrefundable deposit to Disney, sources have said the money wasn't delivered and won't be until all due diligence is done. Disney wants $650 million as well as a $25 million closing fee, making the total $675 million.
To firmly finalize the deal, the buyers have to tell Disney where all the equity and debt money will come from and when. Tutor, Colony and investor James Robinson of Morgan Creek -- which should handle international distribution for the new Miramax -- is going to provide most of the equity, however there might be a certain amount of undisclosed minority investors.
A number of earlier hopeful buyers said the 611-film library was worth $550 million to $600 million. Investor Ron Burkle, who was working with Bob and Harvey Weinstein, valued Miramax at $565 million, but Disney rejected their offer.
Even after the deal is finalized, the partners must still provide additional funding, or arrange a line of credit, to then build the new Miramax and make some movies to drive sales of the library, "from which the best titles have been sold around the world for several years to come."
Miramax will also need a staff and a rights management system to follow sales and collect money that is due. This includes not just theatrical but also ancillary markets like home video, pay TV, free TV and digital rights.