Private equity profited from reselling dormant Miramax library for 3.5x without new production.

Evidence

Unlike in 2004, when the MGM library proved overvalued, Content ­Partners’ library is today proving a lucrative asset, easily exploitable in the gold-rush ­atmosphere of digital streaming distribution led by Netflix, Amazon, Hulu, ­Disney+, Max, Paramount+, Peacock, Apple TV+, and others. Diverse libraries are a crucial lure for attracting digital subscribers to streaming platforms; consequently, PE firms have been securing them as much as possible. In 2010, Disney sought to unload Miramax’s famed indie library of over seven hundred films, which include almost three hundred Oscar nominees, among them Pulp Fiction (Quentin Tarantino, 1994), There Will Be Blood (Paul Thomas Anderson, 2007), and No Country for Old Men (Ethan Coen and Joel Coen, 2007). Tom Barrack, CEO of PE firm Colony Capital, along with investment from Tutor Perini, a construction magnate, acquired the library for nearly $700 million. Colony Capital barely added any new productions to the library while it was owner; ­nevertheless, it was able to sell the library in 2016 to Qatar-based broadcaster BeIN Media Group and earn 3.5 times its equity investment, demonstrating the increasing value of content libraries. — Andrew deWaard, Derivative Media, 301

Categorization

• XREF: Directly serves the reader’s goal: Colony Capital’s buy-hold-sell of Miramax is a catalog-acquisition trace from finance into the streaming catalog.
• SEED: Angle: how PE ownership of Miramax shaped which films stayed available in the streaming era — catalog as capital, not culture.