Independent.ie > Lifestyle > Independent Woman > Celeb News

Spielberg caught in the 'Jaws' of credit squeeze

Javascript is needed to use most of these tools:

Print
Text size

By Guy Adams
Friday Dec 19 2008

He is impossibly rich, uniquely powerful and boasts a copper-bottomed CV that includes dozens of the most influential blockbusters of modern times. But even Steven Spielberg's career is stalling in the face of the global credit crunch.

The legendary movie mogul, who recently "divorced" Paramount Pictures to turn his production firm, DreamWorks, into an independent company, finds himself struggling to raise enough money to get his ambitious new project off the ground.

Ironically, given his unrivalled reputation for producing some of the most lucrative films ever made, such as 'Jaws', 'ET', and the Indiana Jones series, Spielberg seems unable to raise $750m(€525m) of the $1.2bn (€841m) needed to underwrite DreamWorks' forthcoming movie productions.

Without the cash, the firm will be unable to begin work on a selection of eagerly awaited film projectsd. They include Peter Morgan's 'Hereafter', which Clint Eastwood is rumoured to be directing, a terrorist thriller called 'Motorcade', and the Jewish comedy 'Dinner for Schmucks'.

Collapse

Spielberg's problems date back to October, when an Indian company, Reliance Big Entertainment, agreed to put up $500m (€350m) to take his company independent, provided he could raise an additional $750m in loans to finance a total of 17 proposed films over the next seven years.

But the collapse of AIG, which was due to provide a portion of the cash, and the tightening of credit markets left Spielberg unable to secure the cash and his bankers, JP Morgan, have delayed efforts to raise more money until the New Year.

The Hollywood newspaper 'Variety' carried a front-page report that the company's cashflow problems had left an important distribution deal with Universal Pictures "in jeopardy". Its report noted that Spielberg's firm is being forced to "limp along" on $75m (€53m) in bridge financing and must find another $20m (€14m) by mid-January to compensate Paramount Pictures for its departure.

The article asked: "If they had to do it all over again, would DreamWorks co-founder Steven Spielberg and his partner Stacey Snider have left their lucrative deal at Paramount Pictures, where their slate of films had thrived?" (© Independent News Service).

- Guy Adams