A lot rides on success of the Tom Cruise film

United Artists’ second release, “Valkyrie,” got off to a strong start over the Christmas holiday weekend, grossing $30 million in four days. But the movie will have to hold well domestically and score all over the world to make back its production and marketing costs worldwide, which amount to an estimated $150 million or more.

A lot rides on the success of the film — including the future shape of UA. The financing of that entity, and sister company MGM, is more complex and suspenseful than the plot of the Tom Cruise WWII thriller.

MGM chief exec Harry Sloan has repeatedly said the company is not for sale. But insiders say that Kirk Kerkorian, who last week bowed out of his stake in automaker Ford, is mulling the idea of making an offer for MGM. A sale to Kerkorian would mark his fourth time as owner of the studio.

If Kerkorian, or anyone else, could buy the MGM debt, he would get a great deal — but first he’d have to figure out the labyrinthine financing.

In November 2006 Sloan gave Tom Cruise and Paula Wagner 35% of UA, plus greenlight authority over their movies budgeted under $60 million.

Looking for investors, Sloan, Cruise and Wagner raised a development fund from football mogul Dan Snyder, owner of the Washington Redskins. Then, Merrill Lynch offered a $500 million credit facility contingent on Cruise heading the company.

Since then, UA’s first picture, the $35 million “Lions for Lambs,” was slaughtered by the critics and earned only $15 million Stateside plus $48 million overseas. The second UA movie was to be from Oliver Stone: “Pinkville,” about the My Lai massacre. After “Lions for Lambs” tanked, caution prevailed, and Wagner and Cruise pulled the plug, taking a $6 million writeoff on “Pinkville.”

So the focus is on “Valkyrie.” Given the changing financial climate, will Merrill Lynch, now owned by Bank of America, stay the course?

The revolving deal is predicated on certain benchmarks being met and funds being replenished — something that hasn’t happened yet. Merrill Lynch gave UA $400 million to spend for some 15-18 projects over five years — and $100 million was to follow if the films performed at a certain level.

Last year Sloan brought in ex-Universal production co-chief Mary Parent to do for MGM what Cruise and Wagner were supposed to do at UA: supply commercial product.

When he lured her from her lucrative Universal producing deal, Sloan promised Parent plenty of money to work with. But it turns out that she has much less at MGM than she’d bargained for.

But there’s the money at UA. When Wagner left, the company said that MGM couldn’t access the UA funds. But Parent has now assumed duties at UA as well.

“MGM has full access to UA funds,” says a UA spokesman. “Tom is a partner.”

With Wagner gone, Cruise is leaning on Parent’s expertise. He says he’s going to “take it slow,” working with Parent, and make the right decisions.

Parent insists that it makes more sense for her to look for co-financing partners on the MGM side than for MGM to partner with UA. Better she should make more movies at UA with Merril Lynch’s money, she says. She did steer Joss Whedon’s horror film “The Cabin in the Woods” to Cruise and convinced him to make it as a UA movie. She says they will make two UA movies in 2009. “Tom is involved,” she says. “It’s all about timing. It has to be the right projects.”

They’re banking on “Valkyrie” being the right project. When Parent took over UA, she brought in marketing consultant Terry Press to work on “Valkyrie” and hired Press’ former DreamWorks lieutenant Mike Vollman.

Director Bryan Singer originally envisioned “Valkyrie” as a modest $20 million palate cleanser between studio tentpoles. His previous film was the $200 million “Superman Returns.” (The budget was possible: Paul Verhoeven’s WWII epic “Black Book” shot at the same Babelsberg studios with many of the same actors for just $22 million.)

But when Cruise climbed aboard, that meant something else entirely.

Cruise was going to get paid his $20 million vs. 20% of the backend. He got his private jet, and his perks, including helicopter rides to the set and two floors at the best hotel in Berlin for his entourage.

The project then got a $60 million budget. But with shooting in Berlin, and Singer rebuilding sets and losing shooting days, it got pricier still. Thanks to German tax rebates, the studio says, the budget wound up at $75 million, although some say it’s closer to $100 million.

Eventually, it dawned on UA and MGM that “Valkyrie” couldn’t make its money back if Cruise collected his share of the backend. UA sold “Valkyrie” to several foreign territories because the deal with MGM requires them to cap their investment at $60 million.

Cruise, Parent, Press and Vollman tried to undo some of the PR damage caused by an initial photo blast of Cruise with an eyepatch and Nazi uniform and an unfocused trailer. Initially, UA pushed the release of the film from October to February in order to give Singer more time to incorporate late filming of the North Africa opening.

When the film was finished in time, the studio moved it up to December to maximize adult attendance at the holiday box office — and, crucially, to meet the Showtime pay TV window, which expired at the end of December.

UA targeted the two male quadrants: The film played best for men over 35. But UA pushed to get young males in as well. Press also urged that they not pursue an awards campaign. Cruise went along; Singer was disappointed. And MGM spent heavily — as much as $70 million — to launch “Valkyrie” domestically. Now the movie must perform.

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