Warner Bros. is currently renegotiating its $1 billion multimedia production deal with Abu Dhabi, but it’s likely the feature film-financing component is dead.
Announced with great fanfare in September 2007, the deal was supposed to fund movies, video games, movie theatres and even a themepark, but now, as the Middle Eastern oil execs have been hit by the economic downturn, the deal is being renegotiated and may differ significantly from what was originally announced.
The partnership originally earmarked $500 million for feature film production but only one movie has been greenlit, Robert Rodriguez’s Shorts, which is in post-production, and it’s likely that will be the only Warner Bros. film to get any Abu Dhabi money, Variety reports. Instead, the two sides will continue to collaborate on real estate and new media.
According to Variety, the partnership’s announcement may have been premature:
The Emirates inaugurated their Middle East Film Fest in October 2007, and Abu Dhabi execs were keen on making a buzzy statement to help entice big names to the fest.
The Warner Bros. deal, which had taken months of negotiation, seemed the perfect answer. But the actual announcement, in September 2007, was less a longform agreement than a memorandum of understanding.
The film deal, BusinessWeek reports, seems to have been similar in structure to the deal Warner Bros. has with Legendary Pictures:
Under the deal, announced on Sept. 26, 2007, Abu Dhabi and Warner agreed to split 50-50 the financing of films, with Time Warner retaining its rights to a generous distribution fee. The films receiving funds were to be “mutually agreed upon,” but sources say Warner had placed off limits its successful Harry Potter franchise.
And while there are different reasons emerging for why the deal stalled (including Abu Dhabi needing to save money given that oil prices are falling), some have said that the Middle Eastern execs were concerned about the films they had access to. To be fair, Legendary doesn’t get the Harry Potter movies either, but they have managed to lock up Warner Bros.’ superhero business, leaving Abu Dhabi will few surefire hits.
It does seem, though, that Abu Dhabi is still pursuing separate film-financing deals.
In September ’08, the emirate announced the creation of $1 billion production arm Imagenation, with Borgerding tapped as its chief exec.
The division has since announced two separate $250 million production joint ventures with Jeff Skoll‘s Participant Media and Ashok Amritraj‘s Hyde Park Entertainment, and a $100 million production pact with National Geographic Films. No projects have yet been announced out of any of those deals.
Abu Dhabi also recently tapped former Tribeca exec director Peter Scarlet as exec director of its Middle East Film Fest.
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