Disney's $4 billion Lucasfilm deal began with lightsabers in Orlando
By Ronald Grover and Lisa Richwine | Reuters – 2 hrs 41 mins ago
LOS
ANGELES (Reuters) - Walt Disney Co's $4 billion deal to buy George
Lucas's Lucasfilm Ltd, Disney's third major entertainment acquisition in
seven years, started taking shape in May 2011, when the "Star Wars"
creator had to show Disney CEO Bob Iger how to use a lightsaber.
Lucas and Iger were at
Disney's Hollywood Studios theme park in Orlando, Florida, brandishing
the toys at the grand opening of a 3-D version of the park's Star Tours
ride, Iger recalls, and "George had to show me how to use it."
Talks heated up this
summer when the 68-year-old Lucas recently decided he wanted to retire
from running a business to focus on smaller, more personal film
projects. Iger was excited about the prospect of adding marquee
properties like Star Wars and Indiana Jones to the stable of brand names
he's now spent $15 billion to acquire since becoming CEO in 2005.
"We proved with our Pixar and Marvel acquisitions that we know
how to expand the value of a brand," Iger said in an interview. "And
brands don't get much bigger than Star Wars."
Lucas is expected to serve
as a consultant while Disney revs the producer's entertainment company,
which generated $550 million in operating earnings in 2005 when
Lucasfilms made the last installment of his franchise, "Star Wars:
Revenge of the Sith".
Lucas, in a video
interview released at StarWars.com, said: "I really wanted to put the
company somewhere in a larger entity which could protect it. Disney is a
huge corporation. They have all kinds of capabilities and facilities,
so that there's a lot of strength that is gained by this."
'NOT HEARING ANY FOOTSTEPS'
Kathleen Kennedy,
co-chairman of Lucasfilm, is expected to play a major role in the Star
Wars franchise, and Lucasfilm said it would retain operations in
Northern California.
Disney intends to make a
new Star Wars film every two or three years, Iger said. The company will
also use the iconic brand to build theme park rides, produce TV shows
and sell Darth Vader action figures.
"This is remarkably
attractive for Disney," said Matthew Harrigan, an analyst with
Wunderlich Securities. "I almost feel like Lucas really wanted it to be
with Walt Disney and almost gave them a sweetheart deal."
Iger's big ticket
acquisitions haven't always gotten such rave reviews. When Disney bought
Steve Jobs' Pixar animation studio for $7.5 billion in stock in 2006,
some analysts said at the time that the company overpaid for the
producer of "Toy Story" and "Finding Nemo".
Disney has since bought
back the stock it issued for that deal, as it did after spending $4.2
billion in stock and cash to buy comic book and action film maker Marvel
in 2010, said Disney Chief Financial Officer Jay Rasulo.
Both of those transactions
have paid dividends: Marvel produced "The Avengers" earlier this year,
which had worldwide ticket sales of $1.5 billion.
Pixar produced two "Cars"
movies, which sold $1 billion in tickets worldwide, and helped Disney
design the Cars Land section of its California Adventure theme park in
Anaheim.
"I think we made believers
of those who supported us back then," said Iger, "and maybe turned some
of our critics into believers."
When Disney produces the
first of the new "Star Wars" movies in 2015, "Star Wars" and a film
based on a Marvel character will account for as much as half the
studio's action film slate, Iger said in a conference call. Pixar, with
its almost-unblemished record of success at the box office, will
continue to make another film each year.
"I'm not looking over my
shoulder with any of those acquisitions," said Iger. "In football,
there's a term for when a receiver catches the ball and gets hit. It's
called 'hearing footsteps'."
With the Lucasfilms deal, the Disney executive said: "I'm not hearing any footsteps."
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