BURBANK, Calif. - In a bold move to release a staggering 60 films next year, the Walt Disney Co. yesterday acquired leading independent film distributor Miramax Film Corp.
Terms were not disclosed, but the purchase price of privately held Miramax was considered to be in excess of $60 million. Miramax will operate under the Disney banner as an autonomous subsidiary.
Through such films as "sex, lies and videotape," "The Crying Game" and "Enchanted April," Miramax has emerged since its founding 13 years ago as a top purveyor of movies made outside the Hollywood system.
In recent years, its films have been both critical and commercial triumphs. "The Crying Game," acquired for about $5 million, has grossed more than $60 million in domestic theaters.
Miramax has had limited success producing its own movies, instead buying distribution rights to finished films produced by others. It has frequently been cash-strapped and considered a public offering two years ago to raise much needed capital.
"Those problems are over with," Miramax Co-Chairman Harvey Weinstein said yesterday. He said Miramax now has Disney's checkbook.
Miramax leaders to stay
Weinstein and his brother, Bob, who co-owned Miramax, will continue running the company from its New York headquarters. Both signed five-year employment contracts. Miramax movies will be released and marketed by Miramax, not Disney.
"No one comes close (to the Weinstein brothers) to finding, marketing and distributing extraordinary independent film," Disney Studio Chairman Jeffrey Katzenberg said of the Weinstein brothers. "They have built (Miramax) into a home and haven for independent filmmaking talent."
Asked why he didn't just hire the Weinsteins or Miramax's acquisitions executives, Katzenberg said in an interview: "They're just in a completely different business than we are."
In buying the company, Disney will add between 15 and 20 titles to its annual release schedule, Katzenberg said at a news conference. Previously Disney agreed to distribute films made by "Howards End" makers Merchant-Ivory Productions and titles produced by Joe Roth, the former chairman of 20th Century Fox.
With approximately 60 films scheduled for 1993 release, Disney will dwarf its studio rivals, who tend to release about 20 movies annually. Warner Bros., with fewer titles than Disney, won last year's box-office crown.
"I think it says that Disney clearly wants to be a big player in the high-end, art-film market," said Seidler Amdec Securities Inc. analyst Jeffrey Logsdon.
The deal had little apparent effect on Disney's stock, which fell 62 1/2 cents to $40.75 a share on the New York Stock Exchange.
Better deals envisioned
Logsdon said Disney will be able to strike better deals on behalf of Miramax for the rights to such markets as home-video and pay TV. Miramax also will help keep Disney's average movie costs down, as Katzenberg demands.
The Disney studios currently average about $18 million or $19 million a picture, compared with a Hollywood industry average of close to $30 million.
Miramax does not own all distribution rights to all of its film library of 200 titles, which Disney also bought. In fact, the home-video rights to "The Crying Game" belong to Live Entertainment Inc.
With Disney's financial help, Katzenberg said, Miramax not only will be able to produce more movies but also control more rights to the films they acquire - essential with the advent of new technologies.
Katzenberg said he wasn't worried about a Disney-owned company distributing the sexually explicit and gruesomely violent films often prominent in the Miramax lineup. Past releases include the brutal "Reservoir Dogs" and the graphic "The Cook, the Thief, His Wife and Her Lover."