Scots allotting $350 mil for NL
RBS co-financing for 20 filmsThe flurry of activity between Hollywood and Wall Street shows no sign of abating.
New Line Cinema is the latest to get into the game with the announcement Wednesday of a $350 million film financing arrangement with the Royal Bank of Scotland -- a longtime banking partner of the Time Warner subsidiary.
The arrangement will provide co-financing that is expected to last about two years and cover roughly 20 films. Some of the movies involved include 2007's "Hairspray," "Rush Hour 3" and "The Golden Compass" and 2008 titles "Inkheart" (starring Brendan Fraser and Helen Mirren), "Ghosts of Girlfriends Past" (starring Matthew McConaughey) and "Semi-Pro" (starring Will Ferrell).
"The whole concept of the deal is we'd be taking the picking and choosing out of it. Whatever films we're releasing during the financing period are in the deal," said Michael Lynne, co-chairman and co-CEO of New Line, which will share in the likely success of "Rush Hour 3," the latest installment in the franchise that has generated nearly $600 million in worldwide boxoffice grosses.
"When we decided to enter into the financial arrangement, we knew we wanted to benefit, but we also want our financing partner to benefit also. If either one of you pick and choose, on one side or another, you will pick the wrong film."
The deal will cover films of varied genres and production budgets, including potential new tentpole films. Dollar amounts for each film won't be disclosed; instead, the deal will see RBS contribute an agreed-upon percentage to each film.
"This is very important financing with a solid partner," Lynne said. "We're flattered that they wanted to do a deal with us. It's an exciting opportunity for us to do additional work on additional films and to target some more tentpole films."
Lynne declined comment on "The Hobbit," the "Lord of the Rings" prequel that has spurred a vitriolic public battle between New Line and "Rings" director Peter Jackson.
"The ability to work with New Line Cinema on this exciting transaction is a fantastic opportunity for the Royal Bank of Scotland and underlines our commitment to New Line as filmmakers of the highest caliber," said Alex Brown, managing director and head of Structured Asset Finance, Media & Entertainment at RBS.
On Tuesday, entertainment finance company Relativity Media announced it has structured a large-scale financing facility with Citigroup in the $1 billion range to co-finance as many as 90 films with two studios during the next five years.
Other recent deals include Paramount Pictures' slate agreement with Merrill Lynch and hedge fund vehicle Legendary Pictures' five-picture, five-year deal with Warner Bros.