Lions Gate Entertainment has today announced its intention to take over fellow independent film studio Summit Entertainment in a takeover bid worth $412.5 million, according to the Los Angeles Times.
The merger will see two of Hollywood’s biggest independent film studios merge to form one superpower entertainment company with two of the biggest teen film franchises – “The Twilight Saga” and “The Hunger Games” to its name.
A merger between the two companies has been on the cards since late 2008, though no deal had been struck until now.
No doubt Summit is intending on cashing in on its rapid rise to success on the back of the rabidly popular “Twilight Saga”, which has grossed approximately $2.5 billion in the box office world-wide.
However, other films produced by Summit in recent years – Mel Gibson’s “The Beaver” and Brendan Fraser’s “Furry Vengeance” – have flopped at the box office.
Lions Gate has had a similarly troubled existence. Not only was “Abduction” touted as one of the worst films of 2011, it was a box-office flop that was unable to capture the Taylor-Lautner-obsessed market it was aimed at. A film that could’ve been great, “Conan the Barbarian” also failed to achieve any real success.
Summit has been eager to find a buyer before the final “Twilight” film is released later this year.
Layoffs are expected at both companies as they merge marketing, production and distribution departments, with employment contracts yet to be finalised for Summit co-chairmen Rob Friedan and Patrick Wachsberger, who are expected to become heads of Lions Gate’s motion picture group.
Joe Drake, the current film group president for Lions Gate is expected to depart, though will continue with the company at least until “The Hunger Games” is released on March 23rd.
2012 is expected to be a monster year for the combined company with the release of the final “Twilight” film in November, and the first of what should be four “Hunger Games” films on the brink of release.
With “The Hunger Games” being Lions Gate’s biggest movie bet ever, it is crucial that the film achieves box-office success in order to justify its $100 million production budget. No doubt the studio will attempt to replicate the success of the “Twilight Saga” and will most likely use the two to cross-promote each other.