Banks are balking at loaning Bergstein’s partners debt because the Weinsteins are still a wild card
The prospect of a deal between controversial financier David Bergstein and the Walt Disney Company over Miramax has some banks raising questions about the validity of the numbers driving the negotiations.
According to a financial expert with knowledge of the talks, at least two financial institutions have balked at the notion of loaning debt to Bergstein and his three backers because of the valuation being assigned the Miramax library.
Bergstein and his backers, L.A. construction magnate Ron Tutor and two other unnamed individuals, had previously offered more than $650 million for the Miramax library, the highest bid in the process so far.
Bergstein has plenty of financial troubles of his own.
But what worries the banks is what lies in Disney’s five-year-old exit deal with Harvey and Bob Weinstein, who got divorced from the company but retained the rights to 15 Miramax franchise films (though not the name of the company).
Whoever owns the Miramax library will need the consent of the Weinstein brothers be able to make sequels or any other projects based on the original film properties Spy Kids, Scream, Scary Movie, Halloween, Pulp Fiction, Sin City and several others.
Valuation experts have placed the value of those franchises at somewhere between $150 million to $200 million. That would be close to one-third of the value of the deal Bergstein is seeking to make with Disney.
Without the active cooperation of the Weinsteins – whose attempt to buy Miramax with billionaire Ron Burkle foundered a week ago – the banks are having a hard time justifying the high valuation. (See: Disney, Bergstein Negotiating Exclusively Over Miramax
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