Twilight Studio Seeking To Borrow $800 Million
With its current ability to borrow money at lower interest rates thanks to its success with the Twilight movies, Summit Entertainment plans to recapitalize by raising $800 million in new loans that will be used to pay off its higher-interest old loans and pay a dividend to stakeholders, the Los Angeles Times reported today (Thursday), citing people close to the matter. Commenting on the studio's plans, Moody's Investors Services said on Wednesday, "We remain cautious about the sustainability of strong credit metrics beyond 2012, given the end of the Twilight franchise, uncertainty about a replacement franchise and the volatile nature of the company's business." Standard and Poor's raised a similar concern, saying, "Summit's business risk profile as vulnerable because of its narrow business focus, revenue concentration on one movie franchise, and earnings volatility from the timing of hit movie releases." Summit is also the studio that released -- with mixed results -- such films as the Oscar-winning The Hurt Locker, as well as last year's Step Up 3D, RED, Remember Me, and Furry Vengeance . It's also the studio behind the oft-postponed Mel Gibson movie, The Beaver.