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'Terminator' rights may change hands again

Producers Derek Anderson and Victor Kubicek, owners of the science-fiction franchise, put it up for sale as their companies work their way through Chapter 11 reorganization.

September 29, 2009|Ben Fritz

The rights to "Terminator" are up for sale yet again.

Derek Anderson and Victor Kubicek, who acquired the science-fiction franchise in 2007 for $25 million and produced this year's sequel "Terminator Salvation," are looking to sell the rights as several companies owned by the two producers work their way through Chapter 11 reorganization.

Anderson and Kubicek's Halcyon Holding Group has engaged financial advisory firm FTI Capital Advisors, pending approval by U.S. Bankruptcy Court in Los Angeles, to "evaluate strategic alternatives," according to a statement. Since Halcyon's only valuable asset is the "Terminator" rights, any deal would involve an investment in or outright sale of the rights.

"We're going to be contacting a variety of studios and independent companies," said Kevin Shultz, senior managing director at FTI. "We think the values are considerably in excess of the purchase price."

Since "The Terminator" was released in 1984, the franchise rights have changed hands frequently. When the first movie came out, production company Hemdale Films owned a 50% interest and director James Cameron sold the other half to producer Gale Anne Hurd for $1.

Carolco Pictures, owned by producers Mario Kassar and Andrew Vajna, bought Hemdale's stake in 1990 for $10 million and released "Terminator 2: Judgment Day" the next year. In 1997, after Carolco filed for bankruptcy, they started a new venture, C2 Pictures, which bought their old company's stake at auction for $8 million and the remaining 50% from Hurd for $7 million.

In 2007, Kassar and Vajna sold the rights to novice producers Anderson and Kubicek in a deal that surprised many people in Hollywood.

In a previous Bankruptcy Court filing, Anderson contended that the "Terminator" rights were worth more than $60 million, more than double what he and Kubicek paid. Shultz said his firm would conduct its own analysis. Such valuations, which are based on forthcoming cash flow from "Terminator Salvation" as well as potential sequels, can vary widely because the performance of future films is difficult to predict.

Anderson also said that Halcyon had received expressions of interest in buying the "Terminator" rights from several companies, including Sony Pictures, which distributed "Salvation" overseas. A Sony spokesperson declined to comment.

Three companies owned by Anderson and Kubicek that own the "Terminator" rights and their interests in it filed for bankruptcy protection last month, triggered by a disputed debt owed to Pacificor, a Santa Barbara-based hedge fund that lent the producers money to make the purchase, along with working capital.

At the same time, the producers filed a suit against Pacificor over the disputed debt. That suit has since been dropped because of what a Halcyon spokesperson called "procedural maneuvering."

Halcyon and Pacificor remain at odds in Bankruptcy Court, however. Halcyon contends that it owes Pacificor $4 million plus interest and fees. Pacificor Chief Executive Andy Mitchell says the amount owed is $32 million.

Any potential sale of the "Terminator" rights would have to be approved by a bankruptcy judge, who would then determine what portion of the proceeds would go to Pacificor and other debtors.

A Halcyon spokesperson said the company would pay back all of its debts after a "Terminator" transaction.

Anderson and Kubicek have also sued former Pacificor employee Kurt Benjamin, alleging that he pushed their firms into a series of bad decisions that led to bankruptcy. Benjamin has denied the allegations.

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ben.fritz@latimes.com

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