DreamWorks will get its $325 mil

Verbal commitments secured; bankers to close on funding

Team Spielberg is at the goal line and getting ready to spike the ball.

DreamWorks' plan to raise $325 million in lender financing -- part of a funding scheme covering at least three years of film production -- is now oversubscribed with verbal commitments, and its bankers soon will begin closing on the loan syndication.

Reliance Big Entertainment will provide a letter of credit for a matching amount in equity funding, and RBE topper Anil Ambani is heading to Los Angeles on Monday for a CAA-hosted reception to introduce him to local VIPs. Ambani is visiting the U.S. for other business, and the talent agency is taking the opportunity to introduce the Mumbai magnate to top talent and others involved in a number of film production deals inked through CAA last year.

A term sheet detailing minor structural changes on DreamWorks' planned loan syndication must be circulated. But the changes are mostly beneficial to participating lenders and shouldn't keep the loan-closing process from commencing in two or three weeks.

A third component of DreamWorks' funding plans will see its distribution partner Disney lend DreamWorks up to $175 million.

JPMorgan Chase, which is leading the syndication, will contribute $75 million. CityNational and Bank of America are on board for $50 million apiece, with several other lenders firmly committed for a range of lesser amounts.

"It certainly is our expectation that we will be fully committed and able to announce that soon," DreamWorks spokesman Chip Sullivan said. "We're very close to the finish line."

Once buttoned up, the financing will fund the production of at least three first-year projects and five or six movies a year thereafter.

DreamWorks originally had planned a $750 million loan syndication before credit markets collapsed, and the continued goal is to keep raising money as capital markets bounce back. Meanwhile, the latest developments will keep things well on track as principals Steven Spielberg and Stacey Snider continue to reinvent DreamWorks as a private company following their departure from Paramount last fall.

A happy conclusion to the long-in-gestation loan syndication will also mark a major coup for JPMorgan Securities, which has been dealing with a marketplace that's contracted from 40 entertainment-finance lenders to less than a dozen in recent months.
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