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Summit pulls out of bidding for Miramax
LOS ANGELES |
LOS ANGELES (Reuters) - Independent movie studio Summit Entertainment has pulled out of bidding for the Walt Disney Co's Miramax film unit, amid questions about how much Miramax is worth and whether Disney is asking too much.
Summit had been seen as a highly interested potential buyer for Miramax, because the fledgling independent studio behind teen vampire franchise "The Twilight Saga" lacks a film library to provide stable revenue.
But on Friday, Summit confirmed it is no longer in the bidding for Miramax. The company declined to comment further.
Sources say Disney is asking more than $650 million for Miramax, which it bought from independent producers Bob and Harvey Weinstein in 1993 for $80 million.
Disney declined to comment about the sale.
Hal Vogel, an analyst with Vogel Capital Management, said that Miramax is worth "less than probably what Disney thinks, but more than what Summit on its own can afford."
A number of Hollywood studios are reportedly interested in picking up the independent outfit behind such art-house fare as "Pulp Fiction" and "No Country for Old Men."
But some major players have shown little interest in Miramax, at least publicly.
News Corp Chief Executive Rupert Murdoch said on a conference call earlier this month that he is not interested in Miramax, and investor Carl Icahn this week said he would tender for more shares of Lions Gate, in a move seen aimed at curbing potential purchases of studios like Miramax.
Icahn told CNBC on Thursday, "It's no secret they're looking at MGM and Miramax" and that he wanted to boost his stake to have more say about potential acquisitions.
In a report this month, analyst David Miller of Caris & Company said if Lions Gate buys Miramax for under $300 million, it "would be seen as largely a net positive by most analysts."
Lions Gate declined to comment.
But a source close to the situation said Lions Gate is still interested in bidding for Miramax. And in an SEC filing on Wednesday, Lions Gate sought permission to obtain $750 million in securities, including for potential acquisitions.
A source close to the situation, who declined to be named, said earlier this week that Miramax has drawn interest from private equity firms, and that potential bidders are "getting to the range Disney is asking."
But he said that Disney has so far revealed few financial details on Miramax's operation. He added that one entity recently put in a nonbinding bid in the $650 million to $750 million range, just to get to the next round.
"If they (Disney) open the kimono, give everyone the information they need and let folks start now doing due diligence, I think they would probably get real offers within four weeks, and they could probably close it within a couple of months after that," the source said.
Financially troubled independent studio The Weinstein Company, led by the two brothers who founded Miramax in 1979, is reportedly interested in Miramax. A spokeswoman for the company declined comment on Friday.
(Additional reporting by Sue Zeidler and Anupreeta Das; Editing by Bernard Orr)
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