Another Summit mounted
EmptyArmed with more than $1 billion in funding from Merrill Lynch and other investors, former Paramount Pictures COO Rob Friedman and Summit Entertainment president and CEO Patrick Wachsberger are launching a new Summit Entertainment Llc., a studio set to produce, acquire, market and domestically distribute films.
Friedman will be CEO and Wachsberger will serve as president of the studio, with both sharing the title of co-chairman. The company has absorbed the production, distribution and international sales outfit of the same name and will continue to function as a sales agent for its own films and outside projects through its new arm, Summit International. Wachsberger will lead that division as CEO.
Heading the company's executive team are three Summit veterans: COO Robert Hayward, production and acquisitions president Erik Feig and senior executive vp David Garrett, who will serve as president of Summit International. Ron Hohauser will join the team as CFO.
Each year, the company plans to produce about eight films for worldwide distribution and acquire about four films for distribution domestically and in other territories. Titles are expected to range from $15 million-$60 million in a wide variety of genres that Friedman described as "studio commercial fare."
The company is said to be in talks with at least two veteran executives to head its domestic distribution division, with an announcement expected shortly.
The Summit deal has been in the works with Merrill Lynch since last summer. "In preparation, we turned up the volume on developing projects and will rely primarily on production," Wachsberger said.
Summit is producing several films with domestic distribution deals at major studios. Neither Friedman nor Wachsberger would comment on the titles the company would potentially distribute domestically but said it would include current Summit titles without domestic distribution. The first film could be released as soon as late summer.
Among the dozen or so titles now in stages of development at Summit are the serial killer thriller "Labyrinth" starring Hilary Swank (who also serves as a producer); Gary Winick's romantic drama "Letters to Juliet" with producer Ellen Barkin; an adaptation of a 1963 "Twilight Zone" episode, "Countdown"; and the parking lot thriller "P2" starring Wes Bentley. The latter likely is to be one of the first domestic Summit releases.
Summit has no current pay TV deal, and when asked about plans for one, Friedman noted that "many companies have pay TV deals up for renewal" that he might consider. One such company might be MGM, which has deal with Showtime that expires next year. Both execs also have expressed strong interest in digital distribution in such venues as downloadable films and iPod-ready product, but Friedman said that any ventures into that arena "won't damage any customary windows — we want to preserve the economic benefit from them."
Michael Blum, head of Merrill Lynch's Global Structured Finance & Investments Group, said the complex formation of the company represented a "very large capital risk of debt and equity." Although he couldn't disclose which investors came aboard, he said many are in various mediums related to the film business and have entered into strategic partnerships that will be announced in the near future.
"They may find this as an opportunity not only to invest but also be a part of the studio," he said. "Their participation will depend on the extent of their investment."
One investor is Gallic distributor SND/M6, which also signed a multiyear deal to release Summit's films in France. SND/M6 CEO Thierry Desmichelle and acquisitions head Lionel Uzan negotiated the deal for their company.
Merrill Lynch has previously raised money in several production deals, including $200 million in production financing for Tom Pollack and Ivan Reitman's Cold Spring Pictures. And Tom Cruise and Paula Wagner's United Artists is "weeks away" from concluding a $500 million film financing fund with Merrill Lynch, MGM COO Rick Sands said this week.
Merrill Lynch led the Summit dealmaking, serving as the placement agent and transaction adviser to Summit, led by Robert Stanley, Patrick Lampe and Josh Green. Attorneys Joshua Grode and Bertha Willner of Liner Yankelevitz represented Summit in financing and acquisition transactions. Gary Stern and Sam Gandhi of Sidley Austin represented Merrill Lynch. Schuyler Moore of Stroock & Stroock & Lavan Llp. represented the existing Summit shareholders.