It is called Operation Turbo.
Starz Entertainment CEO Chris Albrecht and his associates have been meeting with potential partners throughout the world to raise $1 billion of off-balance-sheet financing for original programming, sources said.
Starz parent Liberty Media gave Albrecht the task of raising the money needed to greatly increase original programming on the Starz pay services, as competitors HBO and Showtime have done.
As part of Operation Turbo, there have been meetings with Studio Canal in France and the BBC in London, among others, but the economic climate is making everyone careful.
"This has been met with great enthusiasm from potential partners, but so far no deals have closed," a source close to Starz said. "Negotiations continue."
Under the deal being pitched, the partners would create a new company that would license to Starz all domestic and some international rights, with the investor taking all other international rights. The programs created would have global appeal like this year's well-received Starz series "Spartacus: Blood and Sand."
The maneuvers are the latest overseen by Liberty Media chairman John Malone and CEO Greg Maffei, who during the past year have rethought their corporate structure and especially their plans in the entertainment business.
Plans to plunge into the movie business, which seemed like a good idea in 2007, turned sour with the recession. Liberty since has mostly moved out of theatricals, and Malone has made comments indicating that his big push will be into global cable TV systems.
On Friday, Liberty/Starz unloaded Overture Films and its overhead -- employees, offices, etc. -- to Relativity, breaking up the bundle known as Starz Media that had been shopped this year. The bids apparently weren't what Liberty hoped, coming in at $150 million-$200 million. That not only was below the $225 million it was seeking but also far less than it had invested.
Liberty retains the 16 movies in the Overture library, which have contracts worth about $170 million in receivables. That will be used in part to cover nearly $80 million in leftover third-party and bank borrowing done by Overture.
With Overture gone, Starz Media consists of Anchor Bay, Film Roman and Starz Animation.
Anchor Bay is a home video distributor with a library of 3,500 titles, mostly exercise and self-help product along with some movies. Most of the films that have sold well during the past couple of years have come from Overture, which stopped making movies in January. Anchor Bay continues to do limited domestic releases for a handful of acquired theatricals each year, as it has done this year with "City Island."
Tuesday, July 27, 2010
Starz aims to raise $1 bil for programming
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