Warner Bros. is in talks with Bank of America Merrill Lynch and New York-based financial firm Dune Capital for a major co-financing deal that would help replace Legendary’s coin when the production shingle departs.
Warner Bros. and Dune declined to comment. Bank of America has a policy of not commenting on deals which are in the works.
Dune isn’t new to the slate financing business, and its 2005 pact with 20th Century Fox is often hailed as one of the most successful pair-ups between a financier and studio. Now led by Steve Mnuchin, Dune first partnered with 20th Century Fox in 2005 on a multi-hundred million-dollar deal that was renewed multiple times. The deal helped pay for the juggernaut “Avatar” and dozens of other pics at the studio. “Avatar,” as well as Dune’s strategy of taking a piece of nearly every movie at the studio, is widely credited with the partnership’s success.
Dune will employ a similar strategy at WB, according to multiple people close to the discussions, who say the pact has a distribution fee between 10% and 11%. The deal would fund upwards of 50 films at the studio.
Legendary topper Thomas Tull is expected to choose a new home for his production and financing shingle imminently, most likely at Universal, as his deal with WB expires at the end of the year. The two first pacted in 2005 and have produced an enviable number of blockbusters including “Batman Begins” and “The Dark Knight” and the “Hangover” series.
While Warner Bros. would love to replace the money Tull brought in, sources close to the studio say it’s not a necessity, given the deep pockets of corporate parent Time Warner and its existing relationship with Village Roadshow. But all studios prefer to reduce the risk on their film slate, and so WB has been seeking partners for the better part of the past year.
But financing a studio slate isn’t as easy as it was in the cash-flush mid-2000s. Fox marks the only studio to have closed a major slate deal since 2008. That deal also involved their relationship with Dune: In January, former Dune partner Chip Seelig inked a $400 million co-financing deal at the studio.