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'Expendables' could be a hit for Lions Gate

A good performance at the box office by the action movie could help shore up the studio's position as investor Carl Icahn tries to seize control of the company.

August 10, 2010|By Claudia Eller and Ben Fritz, Los Angeles Times

When a movie is about to open, its actors and filmmakers usually think only about whether audiences will show up and like what they see.

But Sylvester Stallone, who stars in and directed this coming weekend's "The Expendables," is acutely aware of a pressing matter of an entirely different nature: the behind-the-scenes war raging between the movie's distributor, Lions Gate Entertainment Corp., and corporate raider Carl Icahn, who has been trying to seize control of the company for more than a year.

"It's like the sword of Damocles hanging there as you walk through the front door," said Stallone, referring to the Greek legend about imminent peril faced by people in power. "If the movie does perform, it could help take some of the pressure off. It's been tense over there."

Mounting fear of a hostile takeover by Icahn permeates the executive suites at the Santa Monica studio led by Chief Executive Jon Feltheimer and Vice Chairman Michael Burns as the company struggles to fend off its largest shareholder and keep focused on producing and releasing movies and TV shows.

"The Expendables" holds particular significance right now for Lions Gate, whose movie performances are being closely scrutinized by Icahn. The activist investor has criticized the studio's film strategy and publicly lambasted management for overspending on productions such as the June box-office disappointment "Killers," starring Ashton Kutcher and Katherine Heigl. Lions Gate hasn't had a breakout hit since early 2009 with Tyler Perry's comedy "Madea Goes to Jail."

But based on its strong prerelease buzz, "Expendables" may turn out to be a movie that even Icahn can't disparage. The high-octane action movie is generating strong interest among men of all ages and is likely to open to more than $30 million. That's not to say it's a slam-dunk, as the studio learned recently when its comic book adaptation "Kick-Ass" failed to live up to the mega-hype the film generated among fanboys before its release.

The appeal of "Expendables" appears to be twofold. The film's over-the-top action sequences rely less on widely used digital effects than on old-fashioned brute force and spectacular explosions. It also features an ensemble cast alongside Stallone that includes such 1980s iconic action stars as Dolph Lundgren and Terry Crews as well as more contemporary names like Jet Li and Jason Statham, ultimate fighter Randy Couture and professional wrestler Steve Austin. Stallone not only recruited Mickey Rourke for a small role but also tapped his former action rivals Bruce Willis and Arnold Schwarzenegger to appear together with him in what amounts to a movie first.

A return to the kind of revenge action movies such as "Commando" and "Rambo" that Stallone made famous in the 1980s, "Expendables" is about a team of past-their-prime mercenaries who go on a covert mission to overthrow a dictator in South America.

The movie cost just over $85 million to produce, said independent producer Avi Lerner, who added that he secured more than $50 million in foreign presales and put up nearly $10 million of his own money — the most the low-budget film maestro has ever invested in a single picture.

Lions Gate paid just under $20 million for the rights to distribute the movie domestically and in Britain and will spend around $40 million to market the picture. Its $60-million investment is a lot for the studio, which typically spends less on its releases.

Lions Gate motion picture group President Joe Drake said if the movie did at least as well as the last Stallone movie, "Rambo," which grossed $42.7 million in 2008, the studio would make a good return on its bet, after DVD and television sales.

"It has the potential to be a very profitable movie," Drake said.

Given the appeal of Stallone and other stars overseas, "Expendables" could generate significantly more revenue in foreign countries than in the U.S. "Rambo," for instance, grossed 62% of its total box-office take abroad. Li is a major draw in Asia and Statham is popular in Europe.

"I've always believed in Sly as the biggest movie star in the foreign market," Lerner said. "In an action movie, he's the most recognized man in the world."

Stallone credits both Lerner and Lions Gate for stepping up to finance the movie after he had no other takers when he first pitched the idea to potential buyers at the American Film Market more than two years ago. Although his last two films, "Rocky Balboa" and "Rambo," weren't blockbusters, they performed relatively well.

"No one was biting," Stallone recalled. "I thought after 'Rocky' and 'Rambo,' it would be a slam-dunk. But I was out of the game — I was benched."

Stallone has high hopes that "Expendables," unlike "Rocky Balboa," will attract the under-30 crowd.

The movie was a surprise sensation at San Diego's recent Comic Con International event, where Stallone appeared with other cast members and showed clips to some 6,500 fans.

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