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Spurned Spielberg Seeks Disney Deal

Universal scraps Dreamworks plan after demand for more cash

By Rob Quinn, Newser Staff

Posted Feb 7, 2009 8:35 AM CST

(Newser) – Hollywood's own financial crisis has left Steven Spielberg searching for a home for DreamWorks, the Wall Street Journal reports. Talks over a distribution deal with Universal collapsed yesterday after the studio balked at DreamWorks' request to double its financing commitment to $200 million. DreamWorks is now in talks with Disney, and a deal is expected soon.

DreamWorks signed a partnership deal with Bollywood giant Reliance ADA last year, but the credit crisis means the Spielberg venture has been unable to secure the loans necessary to provide its share of financing. DreamWorks needs the cash to meet its goal of making six movies a year, and while Disney may provide, Hollywood execs say the collapse of the Universal deal highlights the scaling back of studios' debt-fueled ambitions.

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Steven Spielberg is seen at the "Indiana Jones and the Kingdom of the Crystal Skull" press conference during the 61st International film festival in Cannes, Sunday, May 18, 2008. (AP Photo/Francois Mori)

CEO of DreamWorks Animation Jeffrey Katzenberg puts on a pair of 3-D glasses while speaking of the advancements in 3-D cinema at the International Consumer Electronics Show Thursday, Jan. 8, 2009. (AP Photo/ Ronda Churchill)

Steven Spielberg plays with photographers as he leaves the "Indiana Jones and the Kingdom of the Crystal Skull" premiere in Cannes, Sunday, May 18, 2008. (AP Photo/Francois Mori)

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For the immediate future, financing new deals—particularly large deals—is quite challenging because the euphoric debt markets of yesteryear are gone. - Amir Malin, a managing principal at Qualia Capital, an investment firm focused on the media and entertainment industry

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Spurned Spielberg Seeks Disney Deal