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Lions Gate is lead bidder for 'Terminator' franchise

COMPANY TOWN

Owner Halcyon Group asked a bankruptcy judge to name the studio the 'stalking horse' bidder, which means any other bid must be higher than Lion's Gate's $15 million plus 5% of future gross receipts.

January 14, 2010|By Ben Fritz
  • Sam Worthington plays the character Marcus Wright in Warner Bros.' "Terminator Salvation." The 2009 release, the fourth movie in the "Terminator" franchise, was poorly received by fans.
Sam Worthington plays the character Marcus Wright in Warner Bros.'… (Warner Bros. )

Lions Gate Entertainment has taken a lead in the bidding for "Terminator," but competition for rights to the26-year-old science fiction franchise is likely to heat up in the next month.

In a federal Bankruptcy Court filing Wednesday, Halcyon Group, the independent production company owned by Derek Anderson and Victor Kubicek, asked a judge to approve naming Lions Gate as "stalking horse" bidder for the "Terminator" rights. The two producers put the film rights up for sale in September to raise cash as they work their way out of Chapter 11 reorganization.

The designation of stalking horse means that any competing offer must be higher than Lions Gate's bid to be considered.

Lions Gate, the Santa Monica-based studio behind the Tyler Perry and "Saw" films, bid $15 million in cash plus 5% of future gross receipts in exchange for the rights to make "Terminator" sequels and spin-offs. Halcyon would retain all revenue generated by the fourth picture in the series, "Terminator Salvation," which sold $372 million in tickets worldwide after its June 2009 release and came out on DVD last month.

Sony Pictures, which distributed "Salvation" overseas; Warner Bros., which distributed the movie domestically; Summit Entertainment, the independent studio behind the "Twilight" movies; and film financing and production company Legendary Pictures are all considering making bids, according to people close to the companies.

Santa Barbara-based private equity firm Pacificor, which lent Halcyon $25 million to buy the "Terminator" rights in 2007, could also make a bid, according to Chief Executive Andy Mitchell. Pacificor's demand that Halcyon repay its debt pushed the production company to file for bankruptcy protection in August.

Any buyer may seek to take the Terminator series in a new direction after "Salvation," which had a mixed box-office performance given its steep $200-million cost and was poorly received by fans.

Several people familiar with the bidding said there were legal obstacles still to be resolved before a deal could be finalized. One major concern is whether certain rights might revert in 2019 to James Cameron, who wrote and directed the first two "Terminator" films. Efforts to reach Cameron were unsuccessful, but the "Avatar" director recently told the Financial Times that he was unlikely to make such a claim and had "moved on" from the series.

If a sale goes through next month, it will be the fifth transfer of ownership for the "Terminator" series since the first movie came out in 1984. Past stakeholders have included Cameron, his former wife and producing partner Gale Anne Hurd, and producers Mario Kassar and Andrew Vajna.

The deadline for bids higher than Lions Gate's is Feb. 5, according to Halcyon's filing. A new owner of the "Terminator" rights will be determined by the Bankruptcy Court at a hearing Feb. 10.

ben.fritz@latimes.com

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