Twenty-First Century Fox, Inc. (NASDAQ:FOXA)
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6 Months : From Jun 2018 to Dec 2018
By Ben Fritz
Because movies take so long to complete and release, running a Hollywood studio typically means planning two to three years into the future.
But just one year from now, Twentieth Century Fox may no longer exist.
That makes it an awkward time for the 2,300 employees of the 83-year-old studio behind "Deadpool 2" and "The Greatest Showman" as they wait to see if Walt Disney Co. receives the foreign regulatory approvals it needs to complete its purchase of most of the assets of parent company 21st Century Fox Inc., which could happen next year.
Unlike its sibling television studio, Fox's movie studio is expected to be significantly downsized once the deal is complete. Disney will likely take over Fox's two biggest film franchises, Avatar and the X-Men, and scale back production of costly movies that don't fit its family-friendly, franchise-focused formula, people close to both companies have said.
Until the deal is done, however, Fox is obligated to keep acting as if it will survive, people who work at the studio say, which means making movies and developing new ideas with no certainty as to what Disney will end up doing with them.
"We're doing the only thing we know how to do, which is put one foot in front of another," said one executive at the studio.
Only adding to the pressure is the reality that some employees are looking for other jobs. Some fear an exodus could start in late August, after the company hands out bonuses for the fiscal year that ended in June.
To make sure Fox can continue operating smoothly, Chief Executive Stacey Snider has extended the contracts of many executives as long as company policy allows, typically through 2021, said people close to the studio.
Employees in departments that Disney is almost certain to slash, such as theatrical distribution and marketing, have been a priority so they don't defect too soon, one of the people said.
Ms. Snider herself is widely expected to leave following the acquisition, as there is unlikely to be a place for her within the new parent company.
Fox has over the past few months remained busy starting work on movies that it plans to release over the next two years. Some, such as an adaptation of Jack London's novel "Call of the Wild" and of a comic book one studio executive described as "'Game of Thrones' with mice," which both mix live action with computer generated effects, could be easy fits for Disney.
Others, such a historical drama about the competition between auto designers from Ferrari and Ford in the 1960s and a trio of young-adult horror movies intended to be released in theaters within a three-month period, are difficult to imagine coming from the studio behind "Avengers" and "Christopher Robin."
Disney will release all of Fox's movies that are complete or in production at the time of the acquisition, said a person with knowledge of its plans.
It's less certain what will happen to films still in development at the time of the takeover. That has made it more difficult for Fox to buy new projects in recent months, said people who work with the studio.
Fox has made new deals this year, including for a film based on the board game "Clue" to be produced by Ryan Reynolds and a new musical from "Wicked" composer Stephen Schwartz. It recently won a bidding war against other studios for a movie about a former cop who manipulated the McDonald's Monopoly game. Ben Affleck is slated to direct the movie, with Matt Damon in the starring role.
But some agents and producers are wary of working with Fox given its precarious future. The team behind "Red Notice," an action script with "Jumanji" and "Fast and Furious" star Dwayne Johnson attached that sparked a bidding war in February, didn't take the potential movie to Fox, said a person close to the sale process.
"People are making an effort to include [Fox] out of respect, but it's not anyone's first choice because you don't know what the studio is going to be," said one movie agent.
It's unclear whether Disney will maintain the Fox movie brand and continue to produce new films under it following the acquisition.
Two Fox movie divisions are likely to survive, though. Disney CEO Robert Iger has publicly touted Fox Searchlight, which makes "prestige" films like last year's best picture Oscar winner "The Shape of Water" and Fox 2000, which specializes in literary adaptations such as the teen coming-out story "Love, Simon," which came out earlier this year. Their relatively inexpensive dramas for adults could be valuable for the Hulu streaming service, which Disney will take control of in the acquisition.
Amid the uncertainty, Ms. Snider has emphasized a revamp of Fox's approach to animation, bringing in a new partner to replace an expired deal with DreamWorks Animation after it was acquired by Comcast Corp. The film studio is partnering with the Fox television studio on a big-screen adaptation of the animated series "Bob's Burgers," a second "Simpsons" movie in development and a "Family Guy" film that would mix animation with live action, said people with knowledge of the projects.
At the same time, Ms. Snider is moving her film studio into TV production, with series in development based on its "Diary of a Wimpy Kid," "Ice Age" and "Night at the Museum" film franchises. Fox Searchlight has expanded into television as well.
-- Erich Schwartzel contributed to this article.
Write to Ben Fritz at email@example.com
(END) Dow Jones Newswires
August 10, 2018 09:15 ET (13:15 GMT)
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