http://www.bloomberg.com/apps/news?pid=20601091&sid=awAE3qYG82Ug&refer=india
DreamWorks Nears Funding Deal With India's Ambani By Andy Fixmer Aug. 8 (Bloomberg) -- DreamWorks SKG is near an agreement to get $550 million in funding from Indian billionaire Anil Ambani, allowing Steven Spielberg's film studio to split from Viacom Inc., according to a person with knowledge of the talks. A deal may be reached as soon as next week, said the person, who declined to be identified because the agreement isn't final. The studio will borrow $400 million and no additional outside equity will be required, the person said yesterday. The investment from Reliance Anil Dhirubhai Ambani Group would give Spielberg, 61, the backing he needs to leave Viacom as soon as November. DreamWorks partners Spielberg, David Geffen and Jeffrey Katzenberg sold the studio to Viacom for $1.6 billion in 2006. The ``Saving Private Ryan'' director has clashed with Brad Grey, who heads Viacom's Paramount studio. Kelly McAndrew, a spokeswoman for New York-based Viacom, declined to comment yesterday. Paramount spokeswoman Patti Rockenwagner didn't return messages seeking comment. DreamWorks spokesman Chip Sullivan said the studio had no comment. ``We have no comment,'' Amit Khanna, chairman of Reliance Entertainment Pvt. said by telephone from Mumbai. ``Nothing at all at the moment.'' Anil Ambani, 49, ranked by Forbes magazine as the world's sixth-richest man, has built his entertainment business through acquisitions, partnerships and setting up radio stations after parting with his elder brother Mukesh Ambani in 2006. Reliance, based in Mumbai, purchased Adlabs Films Ltd., a producer and distributor of Hindi-language movies, in June 2005. `One Big Break' ``He is looking for that one big break,'' said Anand Shah, an analyst at Angel Broking Ltd. in Mumbai, who tracks media and consumer companies in India. ``It is the scale'' of business that is attracting him to partner with Hollywood, Shah said. Bollywood, as mainstream Hindi cinema is known, produces about half the 1,000 movies made annually in India, making the nation's film industry the world's biggest. Still, Walt Disney Co.'s studio entertainment business revenue of $7.6 billion in 2005 was five times the sales Indian movies generated that year. Reliance Big Entertainment announced at the Cannes Film Festival in May that it would consider financing films for eight Hollywood-based production companies promoted by actors and directors, including George Clooney, Nicolas Cage, Tom Hanks, Brad Pitt, Chris Columbus, Jim Carrey and Jay Roach. Reliance's aim is to build an integrated movie company. Terms of Departure Spielberg and Stacey Snider, DreamWorks's chief executive officer, can leave Paramount 60 days after Geffen resigns at the end of August, the person said. A new distributor, possibly General Electric Co.'s Universal Pictures, will release films from DreamWorks, the person said. Under Paramount, DreamWorks produced ``Transformers,'' the third-highest grossing movie in the U.S. and Canada last year at $319.2 million, and ``Indiana Jones and the Kingdom of the Crystal Skull,'' third this year with $314.5 million in domestic ticket sales, according to Box Office Mojo LLC, which tracks industry data. Movies that Spielberg already is developing at Viacom will remain at Paramount under pre-negotiated terms that compensate the director for each project, the person said. Katzenberg is CEO of publicly held DreamWorks Animation SKG Inc., a separate animation studio in Glendale, California, whose distribution agreement with Paramount wouldn't be affected by a split between Viacom and DreamWorks SKG. Viacom, controlled by Sumner Redstone, fell 41 cents, or 1.4 percent, to $28.49 yesterday in New York Stock Exchange composite trading. The shares have declined 35 percent this year. To contact the reporter on this story: Andy Fixmer in Los Angeles at [EMAIL PROTECTED] Last Updated: August 8, 2008 08:50 EDT
