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Par makes library sale official

Pact expected to close in April

Paramount has made official its sale of the DreamWorks library to Soros Strategic Partners and Dune Entertainment, a Soros spin-off.

Price will be $900 million, reducing Par’s cost to acquire DreamWorks to approximately $600 million. The deal is expected to close in April.

Par paid $1.6 million for the studio, and will save an additional $100 million because of what it said were “the conversion of certain commercial agreements from debt to advances.”

Under the terms of the agreement, Par will have the right to re-acquire the library rights after five years. Viacom has previously told investors that the flexibility to sell library rights for limited terms was a key part of its corporate strategy.

Paramount will retain a small stake in the library. Studio will also see another revenue stream by distributing the library for Soros. Exclusive pact will be in effect as long as Soros retains control of the library.

Unlike the sale of the MGM library earlier this year, in which thousands of mostly older titles were bought by a sprawling collection of investors that include Sony, Comcast and private-equity groups, this deal leaves very few shareholders for the elite 59-title library.

Dune recently solidified its entertainment holdings by inking a slate financing deal with 20th Century Fox.

Viacom had promised to sell the library for $850 million-$1 billion within several weeks of the larger transaction’s closing. That happened in late January. If the library sale had faltered, the new Viacom would have emerged with egg on its face, roundly slammed by investors.

Instead, a sale dramatically reduces the purchase price for DreamWorks and gives Par cash to pay down debt or put into new productions.