I usually nod off when a slate deal is announced (I don’t really care how a studio funds its movies), but the Warner Bros.-RatPac arrangement has piqued my interest.
As negotiations evolved (the basics of the pact were announced in April), it’s clear that the strategy here is more ambitious, the content more diverse, the numbers more exotic (potentially involving as much as $1 billion) — and a filmmaker, not a banker, will be calling the shots. That filmmaker, Brett Ratner, is off to China this week to expand the venture’s involvement in that skyrocketing territory, but before he left, we sat down to discuss the deal’s particulars.
At a time when the flow of Hollywood product is not only shrinking but also suffering from creative atrophy, RatPac clearly deserves scrutiny. It envisions not only co-funding studio features, but also backing midbudget films, documentaries and high-end television miniseries. And it is investing substantial funding — $20 million to start, through China Media Capital, a state-backed fund — in Chinese-language product. The goal of this strategy is to build a major library. And along the way, the media landscape may be brightened as well.
Besides Ratner, key players in the deal are James Packer, who has steered the multibillion dollar assets from his father, Kerry Packer, into casinos in Macao and Las Vegas, and now entertainment; and Steven Mnuchin, CEO of OneWest Bank, who put together Dune Capital. Announcement of a chief operating officer for the venture is expected imminently. Also anticipated: disclosure of a co-funding deal with a premiere TV network.
According to its initial scenario, Ratpac will use its revolving fund of $450 million to help fuel the entire Warners slate — an anticipated 84 films over four years — taking a minimal 25% stake in each picture. Its two initial ventures were propitious: “Gravity” and “The Lego Movie.” Followup picture “Jersey Boys” didn’t fare as well.
But RatPac figures that the WB slate, in its post-Jeff Robinov era, will continue the studio’s consistently profitable performance of recent years. To this end, the WB-RatPac lineup is keyed to an 11% distribution fee (some slate deals yield 9%) and there will be no cherry-picking provision. “We’re betting on Warner Bros.,” Ratner says. “We do not pretend to possess the genius ability to predict winners from losers.”
On the other hand, Ratner will be able to raise his bet from 25% to 50% on certain pre-selected films if he so chooses. Such is the case with “Black Mass,” starring Johnny Depp and directed by Scott Cooper. Hence, while RatPac will not be an integral part of the studio’s greenlight process, its influence will be felt if it resolves to raise its bets.
RatPac’s development process also will carry clout. The company’s interest in Donna Tartt’s bestseller “The Goldfinch” helped put that title on the slate. Several other top-line novels also are being negotiated.
Through a separate credit facility, RatPac is involved in a range of midbudget independent films directed by the likes of Russell Crowe, Edward Norton and Roman Polanski, most of which do not have advance U.S. distribution deals. The venture is the principal backer of Warren Beatty’s long-gestating film about Howard Hughes, which wrapped three weeks ago. It cost less than $30 million and will be distributed by Fox.
Since its Warners arrangement is nonexclusive, RatPac will co-finance another Fox film, “Revenant,” starring Leonardo DiCaprio. And Ratner is co-funding development on projects with Brad Pitt’s Plan B and Arnon Milchan’s New Regency.
Will these ambitious plans come together? Ratner has always engendered a degree of skepticism in some camps. Single and free-wheeling, his lifestyle is as high-energy as his “Rush Hour” films. He is impulsive, and says what he thinks, yet is instinctively gracious. Most important, he gets the work done, and his work has been largely successful.
At the moment, the greenlights are flashing, and the money is flowing. What more can a filmmaker ask.