Press Release: Disney to Acquire Middle-earth Enterprises

at 12:02 am by April 1, 201312:02 am by newsfrombree

Whether it was the photoshopped image of JRR Tolkien signing a document, many years after his passing, or the last line of this release, this was one of our 2013….

APRIL FOOLS

Global leader in high-quality family entertainment agrees to acquire world-renowned Middle-earth Enterprises, including THE LORD OF THE RINGS and THE HOBBIT franchises.

Acquisition continues Disney’s strategic focus on creating and monetizing the world’s best branded content, innovative technology and global growth to drive long-term shareholder value.

Middle-earth Enterprises to join company’s global portfolio of world class brands including Disney, ESPN, Pixar, Marvel, Star Wars and ABC.

THE LORD OF THE RINGS: RETURN TO MIDDLE-EARTH feature animated film targeted for release in 2016.

Burbank, CA and Berkeley, CA, April 1, 2013 – Continuing its strategy of delivering exceptional creative content to audiences around the world, The Walt Disney Company (NYSE: DIS) has agreed to acquire Middle-earth Enterprises in a stock and cash transaction. Middle-earth Enterprises, formerly known as Tolkien Enterprises, is a division of The Saul Zaentz Company, headquartered in Berkeley, California.

Under the terms of the agreement, the transaction value is $10 billion (US). The final consideration will be subject to customary post-closing balance sheet adjustments.

“Middle-earth Enterprises reflects the extraordinary passion, vision, and storytelling of JRR Tolkien, the greatest author of the 20th century,” said Robert A. Iger, Chairman and Chief Executive Officer of The Walt Disney Company. “This transaction combines a world-class portfolio of content, with Disney’s unique and unparalleled creativity across multiple platforms, businesses, and markets to generate sustained growth and drive significant long-term value.”

Middle-earth Enterprises owns exclusive worldwide rights to motion picture, merchandising, stage and other rights on certain literary works of J.R.R. Tolkien including The Lord of the Rings and The Hobbit, which are currently licensed to Warner Brothers Entertainment, Inc. The Saul Zaentz Company evolved from Fantasy Records in Berkeley, California, the largest jazz label in the world. In 1972 Saul Zaentz and his Fantasy partners ventured into feature film, producing “Payday” starring Rip Torn. This was followed in 1975 with “One Flew Over the Cuckoo’s Nest,” directed by Milos Forman and co-produced with Michael Douglas, which won five Academy Awards including Best Picture. Zaentz produced “Three Warriors” in 1977 and the animated “The Lord of the Rings” in 1978.

“For the past 35 years, one of my greatest pleasures has been to see The Lord of the Rings passed from one generation to the next,” said Saul Zaentz, owner of The Saul Zaentz Company. “It’s now time for Middle –earth to move into new mediums. I’ve always believed that Middle-earth could live beyond movies, and I thought it was important to set up the transition during my lifetime. I’m confident that with Middle-earth Enterprises having a new home within the Disney organization, Middle-earth will certainly live on and flourish for many generations to come. Disney’s reach and experience give Middle-earth Enterprises the opportunity to blaze new trails in film, television, interactive media, theme parks, live entertainment, and consumer products.”

Under the deal, Disney will acquire ownership of Middle-earth Enterprises, a leader in entertainment and innovation. After completion of the three Hobbit movies currently under license to Warner Brothers Entertainment, Inc., the deal applies to all future operating businesses in live action film production, consumer products, animation, visual effects, and audio post production. Middle-earth Enterprises, formerly known as Tolkien Enterprises, is a division of The Saul Zaentz Company, headquartered in Berkeley, California, and the present intent is for Middle-earth Enterprises employees to remain in their current locations.

Philippa Boyens, Academy-Award winner for The Lord of the Rings: The Return of the King, and screenwriter for the current Hobbit movies, will become President of Middle-earth Enterprises, reporting to Walt Disney Studios Chairman Alan Horn. Additionally she will serve as the brand manager for The Hobbit and The Lord of the Rings, working directly with Disney’s global lines of business to build, further integrate, and maximize the value of this global franchise. Ms. Boyens will serve as executive producer on new Lord of the Rings and Hobbit feature films, with Peter Jackson serving as creative consultant. The Lord of the Rings: Return to Middle-earth is targeted for release in 2016, with more feature films expected to continue the Middle-earth saga and grow the franchise well into the future.

“Pixar is especially excited about combining the genius of JRR Tolkien and our animators. We’ve wanted to get our hands on Tom Bombadil’s yellow boots and bright blue jacket for ages,” enthused Ed Catmull, president of Pixar, a division of Disney. “From the early poems to the Old Forest I hope to bring Tom to life for a new generation of Middle-earth fans. I’m particularly interested in bringing ‘Bombadil goes Boating’ to the big screen.”

The acquisition combines two highly compatible family entertainment brands, and creates a synergistic relationship between them that will also include integration of Middle-earth content into Disney theme parks in Anaheim, Orlando, Paris and Tokyo.

Driven by a tremendously talented creative team, the legendary Lord of the Rings franchise has flourished for more than 35 years, capped by 17 Academy Award and offers a virtually limitless universe of characters and stories to drive continued feature film releases and franchise growth over the long term. The Lord of the Rings and The Hobbit resonate with consumers around the world and create extensive opportunities for Disney to deliver the content across its diverse portfolio of businesses including movies, television, consumer products, games and theme parks. The Lord of the Rings and The Hobbit feature films have earned billions in global box office receipts to date, and continued global demand has propelled The Lord of the Rings and The Hobbit among the world’s top product brands, and Middle-earth Enterprises as a leading product licensor. The franchise provides a sustainable source of high quality, branded content with global appeal and is well suited for new business models including digital platforms, putting the acquisition in strong alignment with Disney’s strategic priorities for continued long-term growth.

The Middle-earth Enterprises acquisition follows Disney’s very successful acquisitions of Lucasfilm, Pixar and Marvel, which demonstrated the company’s unique ability to fully develop and expand the financial potential of high quality creative content with compelling characters and storytelling through the application of innovative technology and multiplatform distribution on a truly global basis to create maximum value. Adding Middle-earth Enterprises to Disney’s portfolio of world class brands significantly enhances the company’s ability to serve consumers with a broad variety of the world’s highest-quality content and to create additional long-term value for our shareholders.

Continuing this strategy, Disney has also acquired the popular Tolkien community, TheOneRing.net (The One Ring, Inc. ) for $65 million. “We can all finally take a long vacation. It has always been our intent to profit from this community, and now we can’t wait to pass the torch over to such a well run corporate entity like Disney,” co-owner and founder Charwen Moonbeam says from his new estate on the private island of Charwenia. “We just know installments of ‘Bilbo Baggins Clubhouse’ will be a real winner with fans!” Staffer Entmaiden adds, “Hope you enjoyed our little April Fools folks!”