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Three years after being one of the lead investors in the $650 million purchase of Miramax from Disney, construction executive Ronald Tutor has sold his stake in the film company, a knowledgeable source confirmed Monday.
Tutor unloaded his stake to the Qatar Investment Authority, which already was the largest investor in Miramax, though it has not played an active role in managing the company. Qatar now holds as much as three-quarters of the Miramax equity.
The lead role in managing Miramax, according to several sources, has been taken by Colony Capital, headed by Tom Barrack. Another Colony executive, former Disney CFO Richard Nanula, helped negotiate the deal and has continued to play a hands-on role in the new Miramax.
A spokesman representing Miramax and Colony declined comment, and a spokesman for Tutor did not immediately respond to a request for comment.
Tutor’s actual initial investment, say other sources, was about $50 million (and might have been as little as $35 million), which at the time made him second only to Qatar as an investor. The rest of the purchase price — slightly more than $400 million — was borrowed at the time.
In November 2011, Miramax refinanced its debt in a $500 million transaction, and all of the investors received a significant dividend. That financing valued Miramax at about $800 million.
Miramax has not had a permanent CEO since Mike Lang stepped down in March. Miramax CFO Steve Schoch has been acting chief executive since then.
Miramax consists of a library of nearly 700 movies and TV shows, including Pulp Fiction, Shakespeare in Love, Chicago, Good Will Hunting, The English Patient and No Country for Old Men. Most of its business since the acquisition from Disney has been licensing those titles for various old and new media, including deals with Lionsgate (home entertainment), Netflix, Hulu, Facebook and a wide range of overseas deals.
While the new Miramax has hinted it might re-enter production to freshen the library, it has not made significant progress in that direction. It has had interests in a handful of movies that were released, including 2011’s The Debt, but otherwise has not been active in making new movies. It also has a deal with The Weinstein Co. to co-develop movies, but that has not yet produced any actual releases.
The Weinstein Co. is run by Bob and Harvey Weinstein, the brothers who founded Miramax and ran it until 2005. They also were potential buyers of Miramax before the group led by Tutor and Colony, which called itself Filmyard Holdings, closed the deal.
In May, Tutor told stock market analysts during a call about the large construction company he runs, Tutor Perini, that he was looking to sell his movie interests. However, at that time it was unclear whether that included Miramax. He said then that he hoped to have a deal to exit the movie business within 10 days.
The Hollywood Reporter reported in May that since August 2010, four months before the Miramax deal, Tutor had sold $188 million of Tutor Perini stock at increasingly lower prices at least in part to pay for his investments in the movie business and his legal problems related to the business. That reduced his stake in Tutor Perini, as of that time, from 43 percent to 23 percent of the stock. Analysts have speculated that the low price of Tutor Perini stock compared to some competitors was in part because of concerns over Tutor’s outside investments in Hollywood and his legal battles. “I hated every sale of stock I’ve made since the first one,” Tutor told analysts in 2011.
Sources say Tutor has been working on selling his Miramax stake since at least the middle of last year.
Tutor also continues to own or control other movie investments related to his dealings with beleaguered investor David Bergstein, with whom he bought ThinkFilm and Capitol Film. Both of those companies ended up (in whole or in part) in an involuntary bankruptcy that started in March 2010.
Tutor has claimed in subsequent legal cases that he sold all of his interests in those companies in early 2009, though a court-appointed bankruptcy trustee, Ronald Durkin, has accused Tutor and Bergstein of backdating those documents to make it appear he got out before he actually did in order to avoid legal entanglements and protect some of his movie investments. Tutor and Bergstein have denied they backdated those documents.
Tutor has had significant legal bills related to the bankruptcy and related cases and has stepped up to buy out some lienholders in various libraries, at a cost in the millions. For instance, he personally invested in a movie called Nailed directed by David O. Russell and reportedly spent more money on editing and scoring. But test screenings did not go well, and it was never released.
Tutor continues to be involved in a number of legal cases related to his ill-fated plunge into the movie business.
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