Rumors to the contrary notwithstanding, the biggest foreign investor in DreamWorks is committed to remaining a partner in the studio, a DreamWorks executive said Thursday.
CJ Entertainment (CJE), a division of South Korean food conglomerate Cheil Jedang Corp., told DreamWorks several weeks ago that because of financial turmoil in Southeast Asia the company needed liquidity and would divest itself of a small part of its 11% stake in DreamWorks, according to Ron Nelson, the studio’s chief financial officer.
But an American bank is believed to have lent CJE the money it needed, putting an end — at least for now — to its plans to sell. “Cheil is fine,” said one source close to the situation.
The issue was revived Thursday by an MSNBC story that said CJE was seeking to sell its entire investment in DreamWorks.
“That’s not exactly true,” said Nelson, who confirmed that CJE has so far invested more than half of the $300 million it committed to pay in a 1995 agreement. “Cheil couldn’t be more thrilled with their investment in DreamWorks and want to remain partners. Cheil has met every funding call and every obligation to us.”
Nelson said that even if it wanted to, CJE could not withdraw from its agreement, which is secured by a letter of credit. The Korean company can, however, divest itself of “a modest amount” of its equity in DreamWorks, he said, “but they haven’t done anything yet.”