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Warner, PolyGram to Back Castle Rock Films

January 07, 1998|Bloomberg News

Time Warner Inc. and PolyGram will jointly finance and distribute films made by Time Warner's Castle Rock Entertainment, allowing the media company to cut costs in its struggling film business. Financial terms were not disclosed. PolyGram is not buying a stake in Castle Rock, which will remain a wholly owned unit of Time Warner, officials at the two companies said. Castle Rock, producer of such hits as "When Harry Met Sally" as well as the television series "Seinfeld," plans to produce five films a year, the companies said. Time Warner previously has been unsuccessful in finding buyers for Castle Rock, which it got as part of its $7.5-billion purchase of Turner Broadcasting System in 1996. Time Warner's movie arm, Warner Bros., which perennially is No. 1 or No. 2 at the box office, had its worst year since 1990 as big-budget films such as December's "The Postman" flopped. Warner Bros. last year ended a longtime venture with producer Arnon Milchan's New Regency Productions, which formed a new venture with News Corp. Last month, Warner Bros. signed a long-term agreement with Village Roadshow Pictures to produce at least 20 pictures over five years.

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