Friday, January 16, 2009
Steven Spielberg forced to dip into bank account
The turmoil in the financial markets has again swept up Hollywood hit-maker Steven Spielberg.
With a charity he supported already stung in the alleged Ponzi scheme run by money manager Bernard Madoff, the director of the "Indiana Jones" movies is being forced to dig into his bank account to fund moviemaking because of delayed financing.
On Thursday, Spielberg had to pay Viacom Inc.'s Paramount Pictures $13.3 million, or half a $26.5 million price tag, to buy the rights to 17 movie projects that were in development while his DreamWorks SKG studio was at Paramount, according to a DreamWorks person familiar with the company's finances.
The person was not authorized to speak publicly about the matter and spoke on condition of anonymity.
Funding delays have meant Spielberg has also had to cover half the costs of DreamWorks' approximately 60 employees since the production company broke off from Paramount in October, the person said.
DreamWorks is teaming up with Reliance Big Entertainment of India to finance its future film slate. Reliance is covering the other half of the unit's ongoing costs.
In a statement, DreamWorks and Reliance said the projects they purchased, with titles including "Dinner for Schmucks" and "Atlantic Rising," ''will lay the foundation for the new company to continue to produce the quality films that DreamWorks is known for."
Reliance has agreed to match up to $550 million in loans raised by JPMorgan Chase & Co. to make movies over a seven-year term, with the bank planning to raise $700 million total, the person said. The bank is now planning to raise $325 million in a first tranche of syndicated loans by March.
"The timetable and level of debt financing has been adjusted to meet the current unprecedented global economic climate but the partners remain enthusiastically committed," the companies said. - AP