Lionsgate Buys Summit; Studio Head Suggests ‘Twilight’ Could Continue After ‘Breaking Dawn Part 2’
By Russ Fischer/Jan. 13, 2012 4:30 pm EST
While Summit investors wanted to get this deal done before Twilight ended and Summit’s overall value fell, it seems like some at Lionsgate don’t feel like Twilight has to be done. Today Lionsgate CEO Jon Feltheimer said he hopes to continue Twilight in some form, either in film or television.
The Twilight Saga: Breaking Dawn Part 2 opens on November 16, and should be a huge release for Summit, and now Lionsgate. But Lionsgate, which has already pushed the Saw series to more installments than can be counted on one hand, may try to further exploit Twilight.
Speaking to the LA Times, Feltheimer said, “I’m anticipating ‘Breaking Dawn Part 2’ being $700 million-plus in worldwide box office.”
He was asked about “whether the franchise would continue in some form,” to which Feltheimer answered,
The most obvious continuation option is a total reboot, beginning the series from scratch and possibly extending it through more films. That probably isn’t something that would happen within the next couple years, but if we’re already seeing a Spider-Man reboot released a mere ten years after Sam Raimi’s first film, why not re-do Twilight after a few years if the financial potential is there?
It’s hard for me to imagine a movie that does $700 million-plus doesn’t have ongoing value. It’s an amazing franchise that they have done a great job of maintaining with absolutely no deterioration. So the simple answer is ‘Boy I hope so.’
There are suggestions that Twilight could move to TV, where it could become something like the Star Trek for sparkly vampire fans, but when asked specifically about that option, the exec said only “I would certainly hope so.” Why do I predict that the overwhelming balance of our readers will counter that with “I certainly hope not”?
Here’s the full press release about Lionsgate’s purchase of Summit:
“Jon Feltheimer, Michael Burns and the rest of the Lionsgate team have built an exciting and entrepreneurial content leader over the past 12 years, and we’re delighted to join together these two great companies,” said Summit Entertainment’s Co-Chairmen Rob Friedman and Patrick Wachsberger. “We believe that the combined entity will be even greater than the sum of its parts and our dramatically enlarged media platform will create tremendous opportunities for all of us within the Summit and Lionsgate families. We want to thank our employees, whose hard work and creativity have led to the successful evolution of Summit into a leading worldwide studio, and the combination of Lionsgate and Summit will be the next chapter in creating a true global media powerhouse.”
“As demonstrated by this acquisition, Lionsgate remains focused on preserving a strong balance sheet while pursuing its long-term growth strategy,” said Dr. Mark H. Rachesky, Co-Chairman of the Lionsgate Board of Directors. “We are big believers in the increasing value of content and this transaction strengthens Lionsgate’s asset base while providing significant financial benefits, including highly visible cash flow and revenue. We are looking forward to realizing the value of a Lionsgate-Summit combination for all Lionsgate shareholders.”
The majority of the purchase price was funded with cash on the balance sheet at Summit. The remainder was funded with $55 million of existing Lionsgate cash, $45 million of cash received from a newly issued series of Lionsgate convertible notes, $50 million of Lionsgate common stock and an additional $20 million of cash or stock to be issued at Lionsgate’s option within 60 days. At closing, Summit’s existing term loan was refinanced with a $500 million debt facility, secured by the collateral of the Summit assets. Although the term loan matures in 2016, the Company anticipates repaying the loan well before the maturity date, due to the significant cash flow the business is expected to generate. In addition, this expected cash flow will facilitate the Company’s financial objective of further deleveraging Lionsgate’s balance sheet. The transaction is expected to be significantly accretive in Lionsgate’s 2013 fiscal year beginning April 1, 2012.
