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Sony Selling Animation, FX?Studio Contemplates Flogging Animation, Digital FX Divisions
Sony Pictures Entertainment is considering selling 50% of its animation division, and even more of its ImageWorks digital effects house.
After a summer of 2007 that saw their live-action Spider-Man 3 top the box office charts, and the animated Surf's Up wipe out in theatres, Sony Pictures Entertainment is considering selling off large chunks of its animation and digital effects divisions. According to the New York Times (registration required), the film studio is looking to flog 50% of its animation division, and even more of its 15-year-old digital effects subsidiary, Sony Pictures Imageworks. Sony has hired investment bank Houlihan Lokey Howard & Zukin to assess the subsidiaries' monetary value of both divisions. An outright sale could net Sony around $500 million, which would more than recoup the $400 million the company has dropped into both divisions over the years. Sony Pictures Animation: Batting 1 For 2 At the Box OfficeLetting go of part of Sony Pictures Animation makes a certain amount of sense. Last year's Open Season was a modest hit in theatres, but this year's Surf's Up only made $58.8 million at the North American box office. Sony never admitted how much Surf's Up cost them to make, but Open Season put the studio back $85 million. It wouldn't be surprising if the former movie cost Sony a similar amount to make. Sony Pictures Animation won't be releasing any movies until March of 2009, when it adapts Judi Barnett's children's novel Cloudy with a Chance of Meatballs for the silver screen. The horror-themed family comedy Hotel Transylvania will be Sony's Fall of 2009 offering. Sony spokesman Jim Kennedy claimed the company is “open to exploring equity partnerships, and it’s no surprise that there is market interest in our visual effects and animation businesses,” but emphasized that “we continue to maintain a strong commitment to making animated movies going forward.” By selling part of the animation studio, Sony hopes to lower costs by laying off animation employees between projects. The studio believes that this will enable them to produce animated films at 2/3 the cost of CGI rivals like DreamWorks Animation and Pixar. Sony also signed a three-year, first-look deal with British studio Aardman Animation, creators of the multiple award-winning Wallace and Gromit series, last April. This sale will not affect that deal, according to the company. Sony Imageworks: Digital FX House Rivals WETA and ILMMore inexplicable is the studio's plan to flog its highly-respected Imageworks division. The 15-year-old special effects house has risen to become one of the biggest FX houses in the biz, rivaling such heavy hitters as Peter Jackson's WETA (which did the computer graphics shots for the Lord of the Rings trilogy) and George Lucas' Industrial Light & Magic, which was first assembled to design the special effects for the Star Wars series. Imageworks' product could be seen in last summer's top flick, the live-action Spider-Man 3. It has a lower margin of profit than most other divisions but it makes producing CGI-heavy movies, such as most summer blockbusters, much more cost-effective. Potential buyers may want to see Imageworks getting into computer games, and television advertisements, which feature more CGI work these days. However, Sony hopes to sell shares in both companies to just one investor, since Imageworks and Sony Pictures Animation work together so closely. Sony Online Entertainment, which produces and markets such interactive multi-player games as Everquest, is apparently not on the block.
The copyright of the article Sony Selling Animation, FX? in Animated Films is owned by Dominic von Riedemann. Permission to republish Sony Selling Animation, FX? in print or online must be granted by the author in writing.
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