Bob And Harvey Break The Leash

Miramax Films co-founders Bob and Harvey Weinstein will end their successful, but often tumultuous, 12-year relationship with The Walt Disney Co. to launch their own media company, Disney and the Weinsteins said Tuesday.

The announcement ends months of difficult talks between Disney and the Weinsteins, who reluctantly leave the name of their company behind. Miramax is a combination of the names of their parents, Miriam and Max.

The financial terms of the settlement were not disclosed.

But a source familiar with the talks said Disney would make a cash payment to the Weinsteins of around $100 million, which includes salary and bonuses owed to the brothers as well as their participation in various projects.

As expected, Disney will retain the Miramax name and the library of more than 800 films. The Weinsteins will keep the Dimension Films label and the two companies will co-produce certain projects, including sequels to such Dimension hits as "Scary Movie" and "Spy Kids."

While the Weinsteins were tremendous creative forces at Disney, Miramax's financial contributions were a relatively small percentage of the entertainment company's overall film revenues.

The Weinsteins have already begun to seek financing for their new company, which will temporarily be called "The Weinstein Co." The advisory board for the new venture includes various investment bankers and media executives as well as Robert Redford and Paul Newman, Harvey Weinstein said during a conference call with reporters.

The separation deal ends a partnership that was marked by artistic achievements, including multiple Academy Awards for such Miramax films as "The English Patient" and "Chicago", and a behind-the-scenes antagonism between the Weinsteins and Disney chief executive Michael Eisner.

The stormy relationship includes Disney chafing at the Weinstein's desire to make larger, more costly films. The two sides also clashed over various projects, with Disney vetoing the Weinstein's proposal to buy independent studio Artisan Films and a stake in the cable channels Bravo and IFC.

Disney also turned down idea of Miramax producing Peter Jackson's "The Lord of the Rings" films. The films were eventually made by New Line Cinema, a subsidiary of Time Warner Inc.

Tuesday, Harvey Weinstein cataloged those disagreements which he said stifled the brothers' entrepreneurial spirit. He noted that Eisner's newly-named successor, Robert Iger, has pledged to give executives more leeway to make deals.

"In the new Disney, I think those entrepreneurial efforts will be met with a stronger response," Weinstein said. "So that's the irony of this deal."

The Weinstein brothers will stay at Disney on a non-exclusive basis through September. Disney will name a new head of Miramax by July, the company said.

During a transition period from July through September, the Weinsteins will work with the new leadership, which will report directly to Dick Cook, chairman of The Walt Disney Studios. The Weinsteins will not make any new commitment to the development or purchase of films on behalf of Miramax.

The Weinsteins will take with them relationships with directors Quentin Tarantino, Kevin Smith, Robert Rodriguez, Anthony Minghella and others who have become part of the company's stable of loyal filmmakers.

The Weinstein's new company will release 15 to 20 films a year, including co-productions with Disney, Weinstein said. It will also include other components, including the Internet and publishing, which will be detailed in the next few weeks, Weinstein said.

Talks between the two sides were described Tuesday as "long and arduous," but also amicable. Cook praised the brothers and Harvey Weinstein said the talks would not have concluded as favorably as they did without the participation of Cook and other Disney executives.

"Harvey and Bob are true motion picture pioneers," Cook said. "All of us at Disney wish them well in their new venture."

By Gary Gentile