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Ovitz Effort to Sell AMG Intensifies

April 24, 2002|CORIE BROWN | TIMES STAFF WRITER

Michael Ovitz is negotiating to sell or merge his Hollywood talent management company with one of a number of entertainment companies, including the Firm, which specializes in talent management in the music industry, according to sources close to the talks.

Disappointed that his original vision for a broad-based entertainment venture never materialized, Ovitz, the former president of Walt Disney Co. and a founding partner of Creative Artists Agency, has been trying for several months to sell his stake in Artists Management Group or merge it with another entertainment company.

And, though the current negotiations are considered serious, there remains a strong possibility that Ovitz will not close a deal any time soon, sources said.

Partners at the Firm could not be reached for comment. AMG declined to comment.

Ovitz's partners in AMG, Julie Yorn and her brother-in-law Rick Yorn, are considered key to any discussions about the future of AMG.

Under their leadership, AMG has grown to be one of Hollywood's largest talent management companies, and their clients--Leonardo DiCaprio, Cameron Diaz, Benicio Del Toro and Samuel L. Jackson--are considered AMG's most important.

The Yorns have 18 months left on their contract and are not expected to extend their relationship with Ovitz beyond that date, sources said.

Ovitz began meeting with potential suitors last summer. Those early discussions focused on the sale of his struggling television venture, Artists Television Group. When no buyer emerged for ATG by September, Ovitz closed that division, writing off losses that television industry sources estimate to be close to $100 million.

Since then, Ovitz has aggressively pursued a wide variety of potential buyers and partners for the rest of his entertainment holdings, of which AMG is the most significant.

Recently, Ovitz has faced a series of setbacks. This month, the head of his ill-fated television company filed a $9.6-million fraud, defamation and breach-of-contract suit claiming Ovitz enticed him to ATG with false promises. That blow followed the loss of valued client Robin Williams, who fired AMG and returned to his former talent agency, CAA.

Last month, StudioCanal, a division of Vivendi Universal, backed out of its three-year multimillion-dollar pact with Ovitz's film production arm, Artists Production Group, leaving the unit hobbled without a financing partner.

During this same period, Ovitz has been slashing costs and reorganizing his sports management and music divisions.

The effort to sell or merge AMG comes at a critical time in the talent representation business. Last week, the Screen Actors Guild voted down a new agreement with talent agencies, raising questions about the future of that time-honored relationship.

Although AMG is a management company, the lack of an agreement between actors and agents creates uncertainty for everyone in the industry.

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