Disney Unloads Miramax for $660M
Sale of ABC networks still lingers in the rumor mill
July 30, 2010
Disney finally sold its struggling film studio, Miramax Films, to Filmyard Holdings for approximately $660 million. While the deal is set to close between mid September and the end of the year. Filmyard’s partners include construction magnate Ron Tutor, Tom Barrack, Barrack's Colony Capital, and several individuals.
A source close to Colony said capital for the acquisition is not coming out of the firm's real estate fund, but declined to elaborate further.
It has been three months since rumors first swirled that Disney was shopping Miramax. A few bidders stepped to the plate including its previous owners Harvey and Bob Weinstein, who sold Miramax to Disney in 1993. Ron Burkle’s Yucaipa Companies reportedly offered close to $600 million for the film studio, while the Gores Group, Platinum Equity and David Bergstein’s Pangea Media Group were all among those interested, according to reports.
As Disney sheds one asset it took on a new one. Earlier this week, Disney acquired the social gaming company, Playdom. During its last financing round, the start-up was valued at $345 million, while Disney paid, $763.2 million.
Disney should continue to stay in the headlines especially with the on-again off-again potential sale of ABC networks. Analysts at Jefferies & Co., in a research note found on Thomson One Analytics, wrote that if Disney were to sell ABC’s network, its production studio, and stations, it could fetch as much as $10 billion.
The FCC rules prevent a sale to other major networks. Its dual network rule prohibits a merger with CBS, FOX, which is owned by News Corp., or other networks. This could potentially leave the doors wide open for private equity firm to take its chances at snatching up ABC. Considering Comcast's deal for NBC Universal, it is also possible that other cable giants could be interested.
If a sale were to transpire the proceeds could be used to invest in video games, but Disney already has its hands in interactive games. The downside is that the segment is operating at a loss and is only responsible for 2% of its revenues.
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