Karo talks deal with Warner Bros.

Two possible cooperation plans are under discussion

MOSCOW -- Russian producer, distributor and theater owner Karo is negotiating a production deal with Warner Bros., according to Alexei Ryazantsev, head of Karo Premiere, the group's production wing.

"We are in an active stage of negotiations," Ryazantsev told the Russian newspaper RBC Daily on Wednesday.

But while sources at Warners acknowledged their distribution relationship with Karo, they said that there are no plans to expand that relationship.

In the RBC Daily article, Ryazantsev said that two possible cooperation plans are under discussion. The first would see Warner Bros. invest $10 million in five movies produced by Karo, which would amount to 50% of the total budgets, while under the second plan, the Hollywood major would become a co-producer rather than just an investor.

All of the Hollywood majors either have announced production plans in Russia or are in negotiations. Sony was the first to go into production here, co-forming Monumental Pictures. The company's first movie, "Awaiting the Miracle," was released last year.

Karo operates 32 movie theaters in Moscow, St. Petersburg and other large Russian cities.