The demise of STX as a distributor continues to pose questions for the future of high-profile movies on their slate, including Guy Ritchie’s action film Operation Fortune, Michael Mann’s big-budget biopic Ferrari, and Daisy Ridley thriller The Marsh King’s Daughter.
For months we’ve heard about a deal being in the works between the Bad Moms and Hustlers outfit and Lionsgate, which would see the latter taking on some, if not all, of STX’s movies for distribution.
That remains the direction of travel and multiple STX executives have moved over to Lionsgate, including former STX chairman Adam Fogelson who is now Vice Chair of the Lionsgate Motion Picture Group.
We understand more will follow in coming weeks, leaving few staff left in STX’s domestic marketing and distribution team.
If Lionsgate is to take on a bunch more movies it stands to reason that it should bulk up its staff. Fogelson will want ‘his guys’. How the two teams mesh culturally and practically, remains to be seen, however. And with a deal still not finalized between the two studios – we hear there should be some clarity by year’s end – some movies have been caught in limbo.
None more so than Guy Ritchie and Jason Statham’s action-comedy Operation Fortune: Ruse De Guerre, which has been ready for some time. We understand the film is now most likely to head to a streamer for domestic. We understand there has been back and forth between Miramax, Lionsgate and STX about the film’s domestic release, with neither Miramax or STX keen to be on the hook for sizeable P&A. A theatrical launch was initially the plan via STX but the company couldn’t fulfil that obligation following its downsizing. Lionsgate did at some point show willing to release the movie – a January launch was once mooted but that would have jutted up against Gerard Butler action pic Plane (which we hear is solid). We hear that Miramax is ultimately seeking a high-dollar U.S. streaming deal.
The film’s international distributors — who played a key role in getting the movie financed – have been waiting patiently to get the movie out. We understand they are now tired of waiting and will start their launches from January, even if it means going ahead of the domestic release.
It hasn’t been plain sailing for Operation Fortune, which already had to change its name from Five Eyes — the name of a western intelligence organisation — due to concerns about how that would play in China. Then a plotline involving Ukrainian mobsters became a minor headache after the Russian invasion. We’re assured this was a minor sticking point and re-edits weren’t needed, despite press reports to the contrary.
Another movie in limbo is The Marsh King’s Daughter, starring Daisy Ridley, Ben Mendolsohn and Garrett Hedlund. The Neil Burger thriller is finished and discussions are going on now about how it can be released. The movie isn’t guaranteed to go through Lionsgate so alternatives are being explored.
The highest-profile film on the STX slate is Michael Mann’s Ferrari, starring Adam Driver, Penelope Cruz and Shailene Woodley. The big-budget biopic wrapped this month. Mann has spent decades getting the movie into production only to see his distribution partner on the film disintegrate during the process.
The big-canvas project, with a budget in the $90M range, was always intended to get a big theatrical rollout. The current expectation among those involved is that Lionsgate will take the movie, providing their deal with STX makes. Big-canvas Michael Mann movies don’t grow on trees after all. But nothing is set in stone. If Lionsgate, for whatever reason, decides against releasing the movie theatrically, we understand that Mann and fellow producer P.J. van Sandwijk have the right to seek a domestic theatrical partner elsewhere.
Meanwhile, Black Bear International, run by former STX President of International John Friedberg, is continuing to handle the international sales of these and a handful of other STX films. The above titles have largely sold out internationally.
Gerard Butler action sequel Greenland 2 is another movie that could have been released by STX. Currently in pre-production, STX had discussions during last week’s AFM with producer-financier Anton about the next steps for packaging the project.
None of these are small movies. They all come with chunky budgets and thus healthy marketing requirements.
There are plenty of moving parts here. Lionsgate, whose own slate is due to ramp up next year with movies including John Wick 4, Hunger Games prequel The Ballad Of Songbirds And Snakes and Eli Roth’s big-budget Borderlands movie, is simultaneously exploring spinoff sales not only of Starz but also its studio business, which includes both the film and TV operations.
As for STX, much of its woes came about because of a disastrous 2020 merger between the company and Indian studio Eros, a move which was seemingly doomed from the outset due to different business cultures and ambitions. The transaction had to be unwound and ultimately an investor consortium led by the Phoenix-based Najafi Companies stepped in with around $155M to take on most of STX’s assets. Covid certainly didn’t help the distributor, but neither did a top-heavy overhead.
For STX, the process has been difficult reputationally as well as financially. Putting multiple movies into bankruptcy (including Chris Pine thriller The Contractor) was a toxic move that put noses out of joint across town and led to legal action. STX would likely say they had to make that move to ensure everyone got paid, which in our understanding, they did. Reneging on distribution commitments — as in the case of Operation Fortune — has also put noses out of joint.
That said, losing a prolific and high-profile distributor-financier wasn’t an outcome anyone wanted. The independent landscape is poorer for it. As one financier told us: “This was a failure of execution, not of business model. We wanted STX to succeed. The business needs STXs.”
With much of STX’s original business and staff now gone, it begs the question just what Najafi has invested in, and just how ready the town will be to get back into business with its new iteration.
STX 2.0, overseen by Bob Simonds and Noah Fogelson, is expected to operate primarily as a production entity, working on 12-15 movies a year, some intended for theatrical, some hybrid, some straight to streamer. We hear the pivot to production is saving the company upwards of $30M in marketing and distribution overhead.
The film slate is apparently coming into focus for next year. We understand Pete Davidson’s Ramones movie for Netflix – on which STX is a producer – is gearing up to go early next year. So is Dave Bautista starrer My Spy 2, which has Amazon aboard for domestic.
There is hope that Kevin Hart Netflix movie Night Wolf will happen in 2023 and Will Smith’s Fast And Loose at Netflix is also understood to be a priority project. If that all comes to pass, that will be a decent outcome.
Quietly, the company is also having success on the TV side with projects including FBOY Island on HBO and SyFy’s Astrid & Lilly Save the World
STX, Lionsgate and Miramax declined to comment for this piece.