NEW YORK — Warner Bros. Pictures has made a deal with venture capitalist Thomas Tull’s Legendary Pictures, which will invest $500 million in a slate of films they will jointly produce.
Tull told Daily Variety that Legendary and Warners would be 50-50 co-financing partners on 25 films to be produced over the course of the multiyear pact. The slate will include films developed by Legendary, which is backed by a cadre of private equity funds.
Legendary’s president is former TriStar production head Chris Lee, who is producing “Superman Returns” for Warners.
Larry Clark, former chief financial officer of Creative Artists Agency, is Legendary’s chief operating officer and CFO, while marketing vet Scott Mednick is chief marketing officer. William Fay, previously president of Centropolis Entertainment, is Legendary president of physical production.
Warners and Legendary intend to team up on major event releases and varied genre films, which the studio will distribute.
Warners’ other major co-financingpartner on the lot is Village Roadshow. Warners led the majors in inking one of the first such co-financing pacts in the early 1990s with New Regency Prods., which is now at 20th Century Fox.
“From the very beginning, we built this plan specifically around private equity and returns,” Tull told Daily Variety. “I myself would not have done this deal six or seven years ago. But the advent of DVD and overseas expansion of the box office has made the movie business much more attractive as an asset class.”
Tull, who serves as Legendary’s chair and CEO, will move to Los Angeles from Atlanta. He was most recently director of media and entertainment holding company the Convex Group.
Tull incorporated Legendary nearly a year ago, but kept the company’s formation under wraps.
“As the process of mounting, marketing and distributing motion pictures remains highly competitive and costly, we welcome the partnership of a skilled, knowledgeable team who can help us manage our risk as we continue to develop and produce top-quality filmed entertainment for the global marketplace,” Warners president and chief operating officer Horn said in a statement.
Legendary’s investors include ABRY Partners, AIG Direct Investments, Banc of America Capital Investors, Columbia Capital, Falcon Investment Advisors and M/C Venture Partners. San Francisco-based investment banking firm Perseus acted as financial adviser to Legendary Pictures in the transaction.
Legendary is expected to be based on the Warners’ lot, where some execs noted that the cash infusion from private equity was a “vote of confidence” for the movie biz.
Recently, Marvel Enterprises pacted with Merrill Lynch to produce a slate of films that will be distributed by Paramount. Under the arrangement, Marvel will have access to a $525 million revolving credit line over seven years to produce up to 10 pics with budgets ranging from $45 million to $180 million.
Merrill Lynch’s collateral is a batch of 10 Marvel characters, including Captain America, the Avengers and Nick Fury.