Bollywood goes Hollywood with Reliance in a Deal 1.2B with Spielberg for a New Film Production Company
By Azam on September 20, 2008 
Big time Hollywood film director Spielberg signs on with Reliance ADA Group for a 1.2B deal to produce films under a new banner. The highly success film maker Spielberg has parted way with Paramount which acquired DreamWorks film production unit founded by Spielberg and partners. Paramount released from the 3 year relationship with Viacom’s Parmaount studio which acquired DreamWorks for 1.6B in late 2005.
Relations between the DreamWorks principals and Paramount have been strained since DreamWorks was acquired by the Viacom owned studio. Despite their uneasy partnership, DreamWorks has continued tochurn out successful movies for Paramount, including last year’s hits Transformers, Disturbia and Blades of Glory. Paramount has work out an arrangement in which the principals involved in DreamWorks would be able to leave with immediate effect, and Spielberg will continue on with the collaboration with projects brought to the studio by Spielberg
Paramount and the Spielberg-Geffen-Snider team will continue to work together on a number of DreamWorks films that have yet to be released by Paramount, including “The Soloist,” a potential Oscar contender starring Jamie Foxx and Robert Downey Jr., as well as a sequel to last year’s “Transformers.”
Reliance ADA Group will invest 500m into the venture with a 50% equity stake and has arranged an additional $700M in debt financing though JPMorgan. Spielberg is expected to work on a slate of six films a year with the first installment likely within a year’s time.
With the deal completed, it is expected the DreamWorks principals will turn their attention to finding a partner to distribute roughly six DreamWorks films a year.
Spielberg has long ties to General Electric Co’s Universal Pictures, which is widely regarded as a leading choice to release future DreamWorks movies. Universal Studios, which has a long track record of distributing films like the director’s Jaws, Jurassic Park, and E.T. the Extra Terrestrial, and where Spielberg has long maintained his offices. Also News Corp.’s Fox studios will be likely considered which has distributed several of Spielberg’s other films and where the director has a strong working relationship.
Reliance is an Indian conglomerate with operations in telecommunications, financial services and energy, though it has more recently branched out into film and entertainment business.
Reliance, which is controlled by billionaire Anil Ambani, in May signed deals with eight Hollywood production houses run by A-list actors, including George Clooney and Brad Pitt.
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Tags : Anil Ambani, DreamWorks, Fox, Paramount, Reliance ADA Group, Spielberg, Universal