800 million reasons Lionsgate is mini no more

Studio no longer a 'mini-major'

Folks, I’m calling it: There are seven majors in town. Lionsgate is a “mini-major” no more.

On the heels of its buyout of Summit Entertainment, the final straw came last week, when Lionsgate closed an $800 million refinancing package, the biggest sack of coin anyone’s plopped down on a Hollywood studio in recent memory. But we actually started kicking this idea around in the newsroom several months ago, when it became clear that Lionsgate is likely to land in the top 5 for 2012 domestic box-office market share.

At the time, a handful of pesky arguments kept that notion from galvanizing: Lionsgate doesn’t have an international distribution arm. Lionsgate isn’t attractive to A-list talent. Lionsgate doesn’t have a specialty division. Lionsgate doesn’t make films over $100 million.

One by one, these arguments have lost their power.

Though it’s true Lionsgate has no built-from-scratch overseas distribution arm, it instead has patched together a Frankenstein’s monster of foreign output deals, wrapping up or renewing five major territories — Scandinavia, German-speaking countries, East Asia, Spain and Latin America — in the past four months alone.

Top-tier thesps once wary of boarding a Lionsgate project now have two pretty good reasons to feel at ease: Jennifer Lawrence and Jennifer Lawrence. The “Hunger Games” star is getting a $10 million upfront paycheck from the now-lensing sequel “Catching Fire,” plus whatever backend she worked out. She’s one of the most in-demand femmes of the moment, and she’ll be the face of Lionsgate’s coming-out franchise for the next few years.

While Lawrence’s ties to the studio should help with perception, paychecks will prop up reality; one agency insider suggested that in this day and age, a working actor is a happy actor, and Lionsgate is making a lot of movies. “(Lionsgate) may be seen as a slight step down, but only for talent that doesn’t understand the inner-workings of the business,” says one tenpercenter with an A-list roster.

Though Lionsgate doesn’t have a high-profile specialty division like Universal’s Focus or Sony Pictures Classics, it does hold a controlling share (45%) of Roadside Attractions, as well as Panteleon, which release Hispanic-targeted indie fare. Then there’s this Tyler Perry guy who makes a few movies here and there.

That Lionsgate doesn’t make movies over $100 million is a sticking point for a lot of folks with whom I’ve talked about this, and it is a distinction worth exploring. Every other studio made a major bet this year (except Paramount, but we’ll come back to them in a minute) to the tune of $150 million or more. Lionsgate has the capital to take that kind of swing, but it’s just not in their DNA.

Is this a bad thing?

In a year that saw two massive studio writedowns from misfired franchise-starters, and questionable profits on several pricier pics, are we really going to hold cost-consciousness against Lionsgate? Are we to scorn them for reaping $685 in worldwide box office for “The Hunger Games,” which it made for $80 million and marketed for $53 million? Should they have spent more?

On the contrary: I’d suggest that an institutional aversion to overspending is a virtue. And the banks feel so gooey about this way of doing business that even though Lionsgate set out to raise $750 million, every major lender wanted to participate, resulting in $800 million in relatively cheap credit over five years.

With “Twilight: Breaking Dawn — Part 2” and a handful of Summit titles in its pocket, Lionsgate is sure to cross the $2 billion mark worldwide this year, good enough for a top 5 spot, beating out Paramount and possibly Fox.

Asked during the Toronto fest whether he considered Lionsgate a major, company vice chairman Michael Burns was noncommittal: We’re doing what we’re doing, he said in so many words, and don’t really care how people categorize it. Studio reps were equally indifferent when I contacted them Monday morning.

So I’m saying it for them.

For my money, there’s really only one remaining hurdle to calling Lionsgate the seventh major … and that’s whether Paramount is ever going to start making movies again.