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By Dietrich Knauth
NEW YORK (Reuters) - U.S. film producer Village Roadshow Entertainment Group is “open to all bids” for a film library that includes rights to well-known movies like The Matrix, Ocean’s Eleven, and The Joker, a company attorney said on Tuesday at a court hearing a day after filing for bankruptcy.
Los Angeles-based Village Roadshow filed for Chapter 11 with a tentative agreement to sell its film library to investment firm Content Partners for $365 million. But the agreement is subject to overbids, and Village Roadshow hopes to hold an auction in May before seeking court approval of a sale, the company's attorney Justin Bernbrock told U.S. Bankruptcy Judge Thomas Horan in Delaware, who is overseeing the case.
Village Roadshow entered bankruptcy with $393 million in secured debt.
The company's film library, which generates $50 million in annual revenue, is its most valuable asset in bankruptcy. It includes the rights to 108 films including the Joker, The Matrix trilogy, Ocean’s series, The Lego Movie, and The Great Gatsby. The films generated $19 billion in total box office receipts and have won 19 Academy Awards, according to Village Roadshow’s court filings.
An attorney for Alcon Entertainment said Tuesday that his client was a potential bidder for the film library. Bernbrock said that Warner Bros could also bid for Village Roadshow’s film rights.
Most of Village Roadshow’s films were co-produced with Warner Bros, and the breakdown of that partnership was one of the factors that pushed the company to seek bankruptcy protection, according to court filings.
Village Roadshow sued Warner Bros in 2022 over the studio's move to release "The Matrix Resurrections" simultaneously in theaters and on HBO Max, alleging that Warner Bros breached a co-production agreement to attract more subscribers to its streaming platform.
The litigation has soured the companies’ working relationship, caused Village Roadshow to rack up $18 million in unpaid legal bills, and risks an adverse ruling that could “flatten” Village Roadshow’s balance sheet, according to court filings.
Warner Bros’ attorney Steven Warren said Tuesday an arbitrator had already sided with Warner Bros in the dispute over the Matrix Resurrections’ release. Warner Bros was the “creative spark” in all of the movies that the two companies co-produced, while Village Roadshow provided financing in exchange for a portion of the film revenues, Warren said.
Village Roadshow faced other challenges besides its dispute with Warner Bros, including a challenging market for movie theaters after the COVID-19 pandemic and an unprofitable effort to produce its own films and television shows after a private equity buyout in 2017.
Village Roadshow's studio business has significant unpaid debts to writers, which damaged its reputation and caused the Writers' Guild to blacklist the company in December 2024.
(Reporting by Dietrich Knauth, Editing by Alexia Garamfalvi and Marguerita Choy)
