Mumbai: Anil Ambani’s Reliance- Anil Dhirubhai Ambani Group (R-Adag) has agreed to invest $825 million (Rs4,018 crore) to produce films jointly with Hollywood director Steven Spielberg’s DreamWorks SKG.
DreamWorks will make five to six films every year.
An announcement by Ambani and Spielberg on Wednesday said $325 million will be brought in by way of equity and the remaining will be arranged through debt.
Stacey Snider, CEO of DreamWorks, said the studio will focus on making commercial, general entertainment films and outlined three projects in a conference call with the media.
Top of the game: Steven Spielberg. Bloomberg
Director-actor Clint Eastwood will be associated with one of the projects.
“This initial phase of funding will include an equity investment from Reliance ADA Group, debt financing from a syndication of banks, as well as funding from Disney,” said a statement from Reliance Big Entertainment—the media and production arm of RADAG.
On partnering with Anil Ambani, Spielberg said the Indian business group was “at the top of the game” with a “great sense of business.” “This venture with Reliance opens a new door to our future,” he said.
The new motion picture company formed by Reliance Big Entertainment and DreamWorks has been functioning since November last year from the latter’s offices in Los Angeles, California, the statement said.
Action films produced by the combine have been sold to George Soros, Ambani said from New York. Ambani will “like to collaborate and cooperate” with the billionaire investor in the future, too.
Soros holds 3% stake in Reliance Big Entertainment.
Earlier this year, DreamWorks had signed a distribution deal with the Walt Disney Co. to market and distribute the studio’s films around the world, except in India where Reliance Big Entertainment will retain the distribution rights.
Dreamworks’ first film after the new fund infusion will take off later this year, although the statement said “they have been actively acquiring properties and developing projects for release in 2010.”
“All of us at DreamWorks studios join with our Reliance partners in anticipating the financial closing,” said Snider.
The film production and distribution deal between the Hollywood studio and the Indian conglomerate was announced in the second half of 2008, capping months of speculation of a tie-up as well as feuding between Spielberg with executives from Paramount Pictures and its corporate parent, Viacom Inc.
The DreamWorks-Ambani tie-up allowed Spielberg to sever ties with Paramount and seek funding from Reliance Big Entertainment at a time when he was strapped for funds.