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Producer Robert Simonds Jr. has partnered with private equity giant TPG and China’s Hony Capital for a new studio venture he believes will fill a mid-range niche in the global movie production landscape.
The new venture announced Monday that it will produce as many as 10 star-driven films a year, with budgets of about $40 million each. The startup says its goal is to invest more than $1 billion in new projects over the next five years. The parties involved haven’t revealed a name for the venture yet.
Simonds, whose production credits include Happy Gilmore and Steve Martin’s reboot of The Pink Panther, says he believes the studios have skewed the movie business towards an overemphasis on tentpole pictures, opening up an opportunity for a smaller producer of mid-range projects with big talent attached.
“Star-driven, mid-budget films are an underserved market and with our proven track record in this area, we are uniquely positioned to successfully partner with traditional distributors in North America, expand in the vast Chinese market and capitalize on new, still developing digital channels,” Simonds said.
Simonds’ executive team includes Chief Operating Officer Thomas McGrath (former COO of Viacom Entertainment), evp corporate development and general counsel Noah Fogelson (former CEO of Crest Animation) and evp, content Sophie Watts. More executive appointments will be announced soon, the company says.
Simonds has indicated that he pacted with Shanghai-based Hony not just for its abundant capital — the investment firm has roughly $7 billion under management — but because it boasts close ties to Shanghai Media Group, one of China’s largest entertainment companies. Last week, SMG announced a partnership with Disney to co-develop branded films for the booming China market.
“This is the first investment a Chinese company has made into a Hollywood studio; and it is a perfect example of how investors bring in various but unique resources to create a new-age studio,” said John Zhao, CEO of Hony Capital. “Together with its strategic partners like SMG and PPTV (a Chinese Internet video company), Hony Capital will bring in the best mix of China’s market resources to help Bob and his veteran team execute the first global-market focused, vertically-integrated studio that Hollywood has seen in a decade.”
In advance of Monday’s announcement, the new studio forged direct distribution agreements with North America’s top theater chains AMC Theaters, Regal Entertainment Group, Cinemark and Carmike, which could prove integral in helping it find its footing in the shadow of the big studios. The new outfit says it expects to make additional announcements in the near term about further distribution deals concerning the pay-TV window and home entertainment. They say they are also exploring digital distribution partnerships with leading online entertainment providers around the world.
Board members of the new company include: Simonds; Zhao; David Bonderman, a founding partner of TPG; Bill McGlashan, managing partner and founder of TPG Growth; Frank Biondi, former CEO of Viacom and former CEO of Universal Studios; Tony Vinciquerra, former CEO of Fox Networks Group; Yang Wenhong, director of film and television at Shanghai Media Group; and veteran producer Gigi Pritzker, founder of OddLot Entertainment.
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