Business

Tutor building a studio

The Walt Disney Co. said today that it is selling Miramax Films to Filmyard Holdings — a group that includes California construction magnate, Ron Tutor and Tom Barrack, CEO of Colony Capital.

The deal, which includes the rights to over 700 films, was for “over $660 million,” Disney said in a statement, “subject to certain adjustments.”

The parties issued a long-awaited press release just after 1 a.m. this morning, a full 24 hours after the Wednesday deadline for an agreement had passed.

The statement said nothing, however, of possible other partners in the venture including actor Rob Lowe, entrepreneur David Bergstein, both of which were mentioned during the long wind-up to the deal. The statement also didn’t mention other sources of funding for the deal to acquire Miramax.

The sale process has been something of nightmare for Disney given the level of haggling to get to this point. Disney announced back in February that it was selling Miramax to focus on its other more family-oriented movie properties.

The negotiations also involved former Miramax founders Harvey and Bob Weinstein and their backers, Ron Burkle and Fortress Capital. That group backed out after their due diligence process reduced their offer price to around $550 million.

The deal with Filmyard will no doubt be a disappointment to the Weinstein Co., which has a strong emotional attachment to the property. The two brothers founded the company in 1979. Lionsgate and Summit Entertainment had also shown interest.

The process hasn’t been simple for Tutor and Colony, either. Acquiring sufficient funds to cover the entire deal has been tricky in an environment where credit conditions are tight and movie libraries are seen as risky business given the overall decline in DVD sales.

Liberty Media just shut down its own Overture studio and MGM is still fighting for its life.

The Miramax library includes “Chicago,” “Shakespeare in Love,” and “No Country for Old Men.” The asset includes books, projects still in development and the valuable name of the company, known around the globe for its art house style movies with mainstream appeal.

The release announcing the sale said the deal is expected to close in the fourth quarter.

“Although we are very proud of Miramax’s many accomplishments, our current strategy for Walt Disney Studios is to focus on the development of great motion pictures under the Disney, Pixar and Marvel brands,” said Disney CEO, Bob Iger.