Miramax negotiates future with Disney
HOLLYWOOD -- No Hollywood figure is generating more intrigue these days than Harvey Weinstein, who's turned his musings about his future into daily grist for industry gossips and news hounds.
In a highly public spat, the Miramax Films co-founder recently became so fed up with parent Walt Disney Co. that he said he was ready to break free from a partnership that produced such Oscar-winning hits as Chicago and Shakespeare in Love. The boiling point came last month when Disney chief Michael Eisner blocked Miramax from releasing Michael Moore's anti-Bush documentary Fahrenheit 9/11.
But behind the battle lines it is the other Weinstein -- Harvey's younger brother Bob -- who may be the biggest dog in this fight. Disney does not want him straying.
Unlike some of the pricey and risky movies now favored by Harvey, Bob has produced a string of lower-budget money-makers at Miramax's Dimension Films unit, including the Spy Kids, Scary Movie and Scream franchises.
Then there's the added boost Bob brings to Eisner, who has been criticized for alienating key creative partners.
If Eisner were able to keep him in the Disney family, the CEO might avoid a public relations fiasco similar to what happened after his company failed to reach a deal with longtime collaborator Pixar Animation Studios. Although the financial impact of losing the men behind Miramax's successes pales in comparison, analysts said their departure would be embarrassing because of the Oscar prestige they've brought to Disney.
"Miramax is highly visible, even though it's a small division," said Merrill Lynch's Jessica Reif Cohen.
Disney executives declined comment, as did Harvey Weinstein. Through a Miramax spokesman, Bob Weinstein said: "As always, Harvey and I are working closely together in trying to reach an amicable resolution with Disney."
Given the tensions and rhetoric, which recently reached an all-time high, most observers think a resolution could come within weeks. In the meantime, Harvey has tried to calm his troops. During a meeting with his senior executives Friday, he downplayed rampant rumors he was heading for the Miramax exit. He said he intends to remain at least until his and Bob's employment contracts expire in September 2005.
There is, of course, a chance that nothing will change and that both brothers will continue to work at Miramax under Disney's direction.
A source close to the Weinsteins said recent discussions with Disney have become less strained. "The temperature from Fahrenheit has cooled down," the source said.
The Weinsteins have feuded with Disney for more than a year over the amount of production and marketing money the conglomerate gives Miramax. They also have clashed over the brothers' compensation. The two sides have not even been able to agree on exactly how much Miramax has contributed to Disney's bottom line.
Eisner recently said Miramax was profitable in just two of the past five years, a contention disputed by the Weinsteins. Last year, according to a source familiar with the studio's finances, Disney recorded an $87 million profit at Miramax. The Weinsteins pegged it at $211 million. From Disney's perspective, Miramax's real value is in its library, valued at an estimated $2 billion by Wall Street media analysts.
On top of the financial disputes is the personal animus between Harvey Weinstein and Eisner, propelling the conflict beyond the normal give-and-take between a parent company and its subsidiary.
As a result of all this, Weinstein has been exploring ways to leave the company he and his brother -- both college dropouts from Queens -- founded 25 years ago and that they named after their parents, Miriam and Max. In 1993, Disney paid about $75 million to buy the scrappy independent movie outfit, the most influential purveyor of art-house films.
The many arrangements now under discussion all have one thing in common: Harvey Weinstein wants the kind of autonomy that can come only from escaping Disney's direct financial and creative control. This would mean setting up an independently financed production company that potentially would pay Disney a fee to distribute its movies.
Sources said that in a best-case scenario, the brothers would be allowed to buy the Miramax name -- something they hold dear because of its sentimental and marquee value. By most accounts, however, that possibility is a long shot.
More likely, Harvey, 52, would launch his own independently financed production company while Bob, 49, would continue to run Miramax's Dimension Films, remaining in the Disney fold.
"From Disney's perspective, it's a great compromise," said Reif Cohen. "Having one Weinstein is better than having none."
For Eisner, the structure removes a thorn in his side. Harvey, who wants to make bigger movies and is attracted to controversial projects, has chafed under Disney's tight controls. At the same time, Eisner would be able to preserve ties with Bob, whose movies are largely profitable and are more in sync with Disney's sensibilities.
"Bob is a supremely successful producer, filmmaker and businessman," said agent Robert Newman, who represents Spy Kids director Robert Rodriguez and years ago worked for the Weinsteins at Miramax.
Those who know the brothers say that whatever shape their future working relationship may take, nothing will come between them.
Said Newman, their longtime friend and business associate: "Their loyalty to each other supercedes anything else in business."
Richard Verrier can be reached at richard.verrier@latimes.com or 1-800-528-4637, Ext. 77936. Claudia Eller is a reporter for the Los Angeles Times, a Tribune Publishing newspaper.
HOLLYWOOD -- No Hollywood figure is generating more intrigue these days than Harvey Weinstein, who's turned his musings about his future into daily grist for industry gossips and news hounds.
In a highly public spat, the Miramax Films co-founder recently became so fed up with parent Walt Disney Co. that he said he was ready to break free from a partnership that produced such Oscar-winning hits as Chicago and Shakespeare in Love. The boiling point came last month when Disney chief Michael Eisner blocked Miramax from releasing Michael Moore's anti-Bush documentary Fahrenheit 9/11.
But behind the battle lines it is the other Weinstein -- Harvey's younger brother Bob -- who may be the biggest dog in this fight. Disney does not want him straying.
Unlike some of the pricey and risky movies now favored by Harvey, Bob has produced a string of lower-budget money-makers at Miramax's Dimension Films unit, including the Spy Kids, Scary Movie and Scream franchises.
Then there's the added boost Bob brings to Eisner, who has been criticized for alienating key creative partners.
If Eisner were able to keep him in the Disney family, the CEO might avoid a public relations fiasco similar to what happened after his company failed to reach a deal with longtime collaborator Pixar Animation Studios. Although the financial impact of losing the men behind Miramax's successes pales in comparison, analysts said their departure would be embarrassing because of the Oscar prestige they've brought to Disney.
"Miramax is highly visible, even though it's a small division," said Merrill Lynch's Jessica Reif Cohen.
Disney executives declined comment, as did Harvey Weinstein. Through a Miramax spokesman, Bob Weinstein said: "As always, Harvey and I are working closely together in trying to reach an amicable resolution with Disney."
Given the tensions and rhetoric, which recently reached an all-time high, most observers think a resolution could come within weeks. In the meantime, Harvey has tried to calm his troops. During a meeting with his senior executives Friday, he downplayed rampant rumors he was heading for the Miramax exit. He said he intends to remain at least until his and Bob's employment contracts expire in September 2005.
There is, of course, a chance that nothing will change and that both brothers will continue to work at Miramax under Disney's direction.
A source close to the Weinsteins said recent discussions with Disney have become less strained. "The temperature from Fahrenheit has cooled down," the source said.
The Weinsteins have feuded with Disney for more than a year over the amount of production and marketing money the conglomerate gives Miramax. They also have clashed over the brothers' compensation. The two sides have not even been able to agree on exactly how much Miramax has contributed to Disney's bottom line.
Eisner recently said Miramax was profitable in just two of the past five years, a contention disputed by the Weinsteins. Last year, according to a source familiar with the studio's finances, Disney recorded an $87 million profit at Miramax. The Weinsteins pegged it at $211 million. From Disney's perspective, Miramax's real value is in its library, valued at an estimated $2 billion by Wall Street media analysts.
On top of the financial disputes is the personal animus between Harvey Weinstein and Eisner, propelling the conflict beyond the normal give-and-take between a parent company and its subsidiary.
As a result of all this, Weinstein has been exploring ways to leave the company he and his brother -- both college dropouts from Queens -- founded 25 years ago and that they named after their parents, Miriam and Max. In 1993, Disney paid about $75 million to buy the scrappy independent movie outfit, the most influential purveyor of art-house films.
The many arrangements now under discussion all have one thing in common: Harvey Weinstein wants the kind of autonomy that can come only from escaping Disney's direct financial and creative control. This would mean setting up an independently financed production company that potentially would pay Disney a fee to distribute its movies.
Sources said that in a best-case scenario, the brothers would be allowed to buy the Miramax name -- something they hold dear because of its sentimental and marquee value. By most accounts, however, that possibility is a long shot.
More likely, Harvey, 52, would launch his own independently financed production company while Bob, 49, would continue to run Miramax's Dimension Films, remaining in the Disney fold.
"From Disney's perspective, it's a great compromise," said Reif Cohen. "Having one Weinstein is better than having none."
For Eisner, the structure removes a thorn in his side. Harvey, who wants to make bigger movies and is attracted to controversial projects, has chafed under Disney's tight controls. At the same time, Eisner would be able to preserve ties with Bob, whose movies are largely profitable and are more in sync with Disney's sensibilities.
"Bob is a supremely successful producer, filmmaker and businessman," said agent Robert Newman, who represents Spy Kids director Robert Rodriguez and years ago worked for the Weinsteins at Miramax.
Those who know the brothers say that whatever shape their future working relationship may take, nothing will come between them.
Said Newman, their longtime friend and business associate: "Their loyalty to each other supercedes anything else in business."
Richard Verrier can be reached at richard.verrier@latimes.com or 1-800-528-4637, Ext. 77936. Claudia Eller is a reporter for the Los Angeles Times, a Tribune Publishing newspaper.