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Breaking: Lionsgate Buys Summit for $412.5 million

Variety broke the news first that Summit Entertainment and Lionsgate have agreed to walk down the aisle, combining the town’s leading minimajors in a cash and stock deal worth $412.5 million. The tentative deal, which has been expected to close for the past week, was announced at the close of the market Friday.

The mini-majors have been negotiating exclusively with each other in recent weeks as execs sorted through the complexity of the transaction.

The merged entity would have more firepower in a market where the majors have scaled back on mid-budget films in favor of tentpoles and franchises — creating an opportunity for sizable indies to fill that gap. The union brings the “Twilight” franchise under the same roof as “The Hunger Games,” which Lionsgate is banking on to revitalize its film slate. The last of the “Twilight” pics, “The Twilight Saga: Breaking Dawn — Part 2,” due to open Nov. 16, is likely to take in as much as $1 billion at the worldwide box office.

The first installment of what Lionsgate hopes will be a franchise based on the popular book series, “Hunger Games” opens March 23. The trailer for the pic got a boost with its target aud in running with Summit’s “Twilight Saga: Breaking Dawn — Part 1,” which did boffo business following its Nov. 20 domestic bow.

Summit’s strategy has been to release and distribute 10-12 films per year, with a focus on the midrange films that the majors are less likely to greenlight. Aside from “Twilight,” Summit’s bread and butter has continues to be broad-based fare at moderate prices with recognizable stars such as “Red,” “Source Code” and a pair of thrillers now in post-production: “Man on a Ledge” with Sam Worthington and “Cold Light of Day” with Henry Cavill, Sigourney Weaver and Bruce Willis. Upcoming pics include dance pic “Step up 4″ and vampire romancer “Warm Bodies.”

Besides the fourth “Twilight,” “Source Code” and ‘The Beaver,” Summit’s 2011 release slate included “The Darkest Hour”, “50/50″ and Chris Weitz’ drama about Mexican immigrants in Los Angeles, “A Better Life.”

A red sequel has been dated for next year but Summit hasn’t locked down a director. Summit’s also been attempting to launch a “Highlander” reboot. .”

Summit also scored a bit of a stunner two years ago with Oscar-winner “The Hurt Locker” — the lowest grosser of any Oscar Best Picture winner.

Unlike Summit, Lionsgate also has a sizable TV production-distribution operation that is home to series including AMC’s “Mad Men,” Showtime’s “Weeds” and “Nurse Jackie,” “Boss” on Starz and the upcoming Charlie Sheen sitcom “Anger Management” on FX. Its Debmar-Mercury syndication operation includes “Tyler Perry’s House of Payne” and “The Wendy Williams Show.”