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Fund to Finance Paramount Films

October 03, 2006|From Bloomberg News

Viacom Inc.'s Paramount Pictures will receive $300 million to help finance at least 30 films through a fund created with investment bank Dresdner Kleinwort.

The Melrose 2 fund follows the creation in 2004 of the $225-million Melrose Investors fund, which helped pay for 25 movies, including the 2004 release "Mean Girls," Los Angeles-based Paramount and London-based Dresdner Kleinwort said Monday.

Hollywood studios are looking for outside investment to reduce risk as production and marketing costs rise. In May, Sony Corp. and General Electric Co.'s Universal Pictures joined with Relativity Media to raise $700 million for films.

Movies to be financed by Melrose 2 include the Eddie Murphy comedy "Norbit," scheduled for release in February, and "The Spiderwick Chronicles," a fantasy adventure slated for 2008.

Viacom units Paramount, DreamWorks SKG, MTV Films and Nick Movies will draw on the fund, the companies said.

"Mean Girls" had a production budget of $17 million and took in $129 million worldwide, according to Box Office Mojo.

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