Disney buys Lucasfilm and thus ILM

Today ILM for the first time in its history was sold, as part of a deal by Disney to buy LucasFilm. fxguide spoke directly to ILM today who commented only that “for ILM and Skywalker Sound it’s business as usual.”

Meanwhile Disney chairman and CEO Bob Iger commented on an investor call regarding ILM that, “our current thinking is that we will let it remain as is – they do great work – they work for multiple studios.”


Disney CEO Bob Iger and George Lucas.

To perhaps demonstrate the enormous capacity and influence of ILM and underline Iger’s point, you need only look at the films they currently have in production. ILM confirmed to fxguide today that the following are on ILM’s books:

* Now You See Me 3/15/13 Dir. Louis Letterier
* The Lone Ranger 5/31/13 Dir. Gore Verbinski for Disney
* Star Trek Into Darkness 5/17/13 Dir. J.J. Abrams for Paramount
* Pacific Rim 6/12/13 Dir. Guillermo del Toro for Warner Bros.
* Noah 7/18/12 Dir. Darren Aronofsky for Paramount/New Regency
* G.I Joe: Retaliation 6/29/12 Dir.Jon Chu for Paramount

Just released is of course the epic Cloud Atlas 10/2012, Directors Tom Tykwer/Andy Wachowski/Lana Wachowski for Warner Bros.

And in fact we know that there are other films in production or pre-production right now but have yet to be announced publicly.

ILM has a long and successful working relationship with Disney – from Star Tours to this year’s mega-hit The Avengers.

Star Tours at Disneyland.

Disney as the parent of ILM does bring a new economic angle to ILM’s work. While ILM has always been run as a business – the Star Wars films, Red Tails and other projects were directed and produced by the owner of the group (Lucasfilm), which is a different process than being part of a very public company such as the Disney Corporation. Of course this close relationship with an effects house is not uncommon. Sony owns Sony Pictures Imageworks and even Disney themselves have owned or own effects businesses such as the now defunct Secret Lab. Walt Disney Feature Animation’s Computer Graphics Unit had merged with Dream Quest Images to create Disney’s The Secret Lab department in October 1999. Dream Quest was one of the early very well respected effects houses. Co-founded by industry legends Hoyt Yeatman and Scott Squires, Dream Quest worked on the Oscar-winning James Cameron’s 1989 undersea epic The Abyss. Ultimately, The Secret Lab department closed in 2002. Of course, Disney also now owns Pixar and runs its own Walt Disney Feature Animation unit.

Perhaps most interestingly in 2007, The Walt Disney Company and Robert Zemeckis set up ImageMovers Digital, a Marin County-based film company, where Zemeckis aimed to produce and direct 3D animated films using performance capture technology. On March 12, 2010, Walt Disney Studios and ImageMovers Digital announced that they would close operations by January 2011. Walt Disney Studios then president Alan Bergman said, “…given today’s economic realities, we need to find alternative ways to bring creative content to audiences and IMD no longer fits into our business model.”

The ILM Yoda fountain outside ILM.

Today however a very different view was expressed by Bob Iger who described ILM as  “a decent business for Lucasfilm and one we have every intention of staying in.”

ILM is of course the most famous and successful visual effects company in the world, known not just in production circles but the most widely known visual effects company in the world, built in large part on a combination of their long history, their innovations and of course the Star Wars franchise. Interestingly one of the other key facts in today’s announcement was that “the companies (Disney and Lucasfilm) have targeted a 2015 release for Star Wars: Episode 7, with Episode 8 and Episode 9 to follow as the the long-term plan is to release a new feature every two or three years. The last Star Wars movie release was 2005’s Revenge Of The Sith – and we believe there’s substantial pent-up demand,” Disney said. Interestingly the deal also includes rights to the Indiana Jones franchise, which could see Disney exploring further films here as well.

The new Star Wars films sound like they would pick up after Episode VI – Return of the Jedi. The companies said Lucasfilm’s Kathleen Kennedy would be executive producer on Episode 7 and any more Star Wars movies, and Lucas would serve as creative consultant.

The stock and cash transaction is worth an estimated $4.05 billion.

As part of the deal, Kennedy will become president of Lucasfilm, reporting to Walt Disney Studios chairman Alan Horn. Kennedy was made Lucasfilm co-chairman June 1st and will also be the brand manager for Star Wars, whose feature films have earned a total of $4.4 billion in global box to date.

Skywalker Sound is also part of the acquisition.

“Lucasfilm reflects the extraordinary passion, vision, and storytelling of its founder, George Lucas,” Iger said. “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.”

Disney will pay half of the consideration in cash and issue approximately 40 million shares at closing based on Disney’s stock price on October 26. Lucasfilm is 100% owned by Lucasfilm chairman and founder Lucas.

“For the past 35 years, one of my greatest pleasures has been to see Star Wars passed from one generation to the next,” said George Lucas as part of the announcement today. “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.”

Lucasfilm’s businesses include live-action film production, consumer products, animation, visual effects, and audio postproduction. Disney also acquires the technologies from the San Francisco-based company, which operates under the names Lucasfilm Ltd., LucasArts, Industrial Light + Magic, and Skywalker Sound.

Below, watch Kathleen Kennedy and George Lucas discuss the future of the Star Wars series:

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