iContent Robot…

“It’s a convoluted, almost Rube Goldberg-type apparatus for generating higher profitability with minimal risk,” said Harold L. Vogel, of Vogel Capital Management. “But we all know the movie business depends on how profitability is defined. We know most movies do not actually make money, or a lot of money. So I don’t know that they come out ahead at the end of the day, even when you adjust for risk and the time it takes. Why go through all this, except to generate fees for Merrill Lynch and some lawyers?”

Because they never got over the big kids picking on them and now they want to be in charge, that’s why.

God, this is all going to tank so huge.

Oh.

Oh, crap.

Marvel requires no capital outlay — but they forfeit film rights to those characters???? Good Heavens, that sounds like a horrendous deal! Remember all the legal trouble Marvel had, getting the license once Cannon Films filed for bancruptcy?

unless they don’t ask David Hasseloff to reprise his role.

~

Coat

“The financial model seems unusually favorable. Because most of the financing raised by Merrill Lynch (the $465 million revolving credit facility) is insured by Ambac Assurance, Marvel is not liable to repay its senior creditors if the movies tank. The Ambac deal uses the comic characters as collateral and thus requires no capital outlay by Marvel.”

“But that if — making successful movies — has tripped up many a brilliant financial model in the past. And the favorable terms mask a hidden risk: If the movies are not successful, Marvel will forfeit the film rights to the characters in the deal, including Captain America, Thor, Nick Fury and the Avengers.”