Based on the closing price of Disney stock on 10/26, the transaction value is $4.05 billion, with Disney paying about half in cash and issuing 40 million shares at closing.
Under the deal, Disney will acquire ownership of Lucasfilm, including its Star Wars franchise and its operating businesses in live action film production, consumer products, animation, visual effects, and audio post production. Disney will also acquire the substantial portfolio of entertainment technologies that have kept audiences enthralled for many years. Lucasfilm operates under the names Lucasfilm Ltd., LucasArts, Industrial Light & Magic, and Skywalker Sound, and the present intent is for Lucasfilm employees to remain in their current locations.
“Lucasfilm reflects the extraordinary passion, vision, and storytelling of its founder, George Lucas,” said Disney Chair and CEO Bob Iger. “This transaction combines a world-class portfolio of content including Star Wars, one of the greatest family entertainment franchises of all time, with Disney’s unique and unparalleled creativity across multiple platforms, businesses, and markets to generate sustained growth and drive significant long-term value.”
“For the past 35 years, one of my greatest pleasures has been to see Star Wars passed from one generation to the next,” said Lucas. “It’s now time for me to pass Star Wars on to a new generation of filmmakers. I’ve always believed that Star Wars could live beyond me, and I thought it was important to set up the transition during my lifetime. I’m confident that with Lucasfilm under the leadership of Kathleen Kennedy, and having a new home within the Disney organization, Star Wars will certainly live on and flourish for many generations to come. Disney’s reach and experience give Lucasfilm the opportunity to blaze new trails in film, television, interactive media, theme parks, live entertainment, and consumer products.”
Kathleen Kennedy, current Co-Chairman of Lucasfilm, will become President of Lucasfilm, reporting to Walt Disney Studios Chairman Alan Horn. Additionally she will serve as the brand manager for Star Wars, working directly with Disney’s global lines of business to build, further integrate, and maximize the value of this global franchise. Kennedy will serve as executive producer on new Star Wars feature films, with George Lucas serving as creative consultant. Star Wars Episode 7 is targeted for release in 2015, with more feature films expected to continue the Star Wars saga and grow the franchise well into the future.
The acquisition follows Disney’s acquisitions of Pixar and Marvel.
RBR-TVBR observation: Indeed, Disney has had little luck with its own productions over the past few years and the new strategy is to acquire companies that have been making blockbusters—especially in animation. The deal also strengthens the long-standing beneficial relationship between the two companies that already includes integration of Star Wars content into Disney theme parks in Anaheim, Orlando, Paris and Tokyo.