Waking Up From Largo’s ‘Dream Deal’

In the late 1980s, when the scent of Japanese money was still fresh in Hollywood, JVC made headline news by investing $100 million in producer Larry Gordon’s Largo Entertainment.

The consumer electronics maker, in return for its money, got an exclusive seat at Hollywood’s table and a chance to share in Gordon’s success. Gordon, for his part, described the agreement giving him autonomy to make up to six films a year as a “dream deal.”

Now, four years and a paltry six films later, both partners may want to wake up from that dream.

Largo is still searching for its first runaway hit, following the modest success of “Unlawful Entry” and “Point Break.” Its latest hopes were dashed last weekend when “Judgment Night” opened to only $4.1 million in box office grosses, behind competition such as “Demolition Man” and “Cool Runnings.”

Sources who do business with Largo say it may soon be running on empty unless it gets more money from JVC or another partner. There’s also persistent speculation--which Gordon denies--that Largo will be folded into Universal Pictures, since Universal and JVC share a parent in Matsushita Electric Industrial Co.

“Largo has basically spent its money,” said one source close to the West Los Angeles production company. “To do more, they have to wait for the movies to create revenue, or they have to negotiate and try to get more money.”

While Gordon and JVC declined to comment on those reports--and refused to answer any substantive questions about the company--the problems ascribed to Largo are not unique. Independent production companies routinely suffer cash crunches because of the enormous cost of doing business and the long odds against box office success.

Carolco Pictures, another independent with foreign backing, came close to prepackaged bankruptcy this year, despite a string of hits that includes “Terminator 2” and “Basic Instinct.”

In the case of Largo, some contend that the company has never found a niche. When the joint venture was formed in 1989, Gordon was coming off the red-hot success of “Die Hard” and before that had been involved in other glossy Hollywood movies such as “48 Hours.” Since then he’s focused on more modest films, including the low-budgeted “Dr. Giggles.”

“They’re not making franchise movies,” said one top executive. “It’s a piece of business, but you can’t remember anyone involved in them. They’re middle-of-the-road.”

On top of that, Largo has come up short of its goal of producing up to six films a year. “Judgment Night” is the company’s only movie scheduled for 1993. An Alec Baldwin-Kim Basinger remake of “The Getaway” is due out next year, as well as “Timecop.”

The game has also shifted in Hollywood. The JVC-Largo deal looks like small change next to Sony’s $3.4-billion-plus-debt purchase of Columbia Pictures and Matsushita’s $6.6-billion purchase of MCA. Moreover, alliances are now geared to the high-tech future, not to melding hardware and software manufacturing.

As recently as January, when Joseph N. Cohen was named to the newly created post of president and chief operating officer, Largo was still openly talking of expanding to six films a year. It also said it had access to more cash from JVC and a three-year, revolving $75-million credit line from an international syndicate headed by Chemical Bank.

On the positive side, the company has a stake in “Waterworld” along with Davis Entertainment. The post-apocalypse action movie is considered one of the hottest projects in Hollywood, with Kevin Costner rumored to be considering the lead role.

But sources say Largo’s money remains tight, especially in light of the “Judgment Night” performance.

One top executive maintains that Largo is “in serious negotiations with regard to Act 2.” Other Hollywood sources question whether there’s any practical reason for Largo to exist now that JVC’s parent, Matsushita, owns entertainment giant MCA Inc.

One person close to Gordon, who’s still known as one of Hollywood’s savviest producers, says Gordon has openly discussed his frustration. The source said he might be happy to shed Largo and return to independent producing.

“Larry started full of enthusiasm,” the source said. “But he’s seeing the light of day.”

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Spectator Sport: In Hollywood, where people are riveted to the battle over Paramount Communications, Barry Diller’s 51% tender offer on Thursday raised the excitement level another notch. At the same time, it reminded everyone that the old truth still holds: Everything important in Hollywood happens in New York.

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Contact Sport: Like football, movie marketing is a tough game. But the team at Tristar Pictures may have crossed the line this week. Following reports that one man had died while apparently imitating a scene from Touchstone Pictures’ “The Program,” Tristar quietly put out word that its own football movie, “Rudy,” is considerably less violent. That may not be the best of all qualities in a football film, but it got people talking about “Rudy.”

Times staff writer James Bates contributed to this story.

Largo’s Lineup

Largo Entertainment, a joint venture between Larry Gordon and JVC, has released six films. They include the successful “Unlawful Entry” and the not-so-successful “Dr. Giggles.”

Film Gross (millions) Year Judgment Night $4.1* 1993 Used People 17.9 1992 Dr. Giggles 8.4 1992 Unlawful Entry 57.1 1992 The Super 11.0 1991 Point Break 43.2 1991

Note: Domestic box office grosses, provided by Entertainment Data Inc.

* “Judgment Night” gross for opening weekend only.