Disney Agrees to Provide Pandemonium Financing

Former Fox Filmed Entertainment chief Bill Mechanic has signed an exclusive, five-year co-financing, production and distribution deal with Walt Disney Studios, where he previously spent nearly a decade as a top executive in charge of international distribution and worldwide video.

Under the deal, Disney is expected to fund a percentage of each movie produced by Mechanic’s 15-month-old independent outfit Pandemonium and pay a portion of the operation’s overhead but will not be an equity partner. The studio retains all domestic distribution rights other than free television as well as worldwide rights except in Spain and Japan and on Italian television.

According to Mechanic, separate deals are pending in those territories and he expects to have talks with broadcast and cable networks about potential deals.

Mechanic said that the bulk of his financing will come through banks and equity partners. He expects to have all the financial pieces in place by early next year. His intention is to produce three to four movies a year.

“Disney is a contributor, but their financial risk is low,” said Mechanic, who with Disney oversaw the explosion of worldwide home video and such hits as “The Lion King” and “Beauty and the Beast.”

Mechanic formed his independent production company in September 2000 shortly after being ousted as the movie chief at 20th Century Fox amid strained relations with Rupert Murdoch, chairman of Fox parent News Corp. and the mogul’s second-in-command, Peter Chernin.

Mechanic said he has no desire to get back on the executive track--even if Walt Disney Co. Chairman Michael Eisner were to ask him to someday head the studio.

“It’s not in the game plan,” he said. “I want to be my own boss.”

Under his Pandemonium banner, Mechanic has more than two dozen projects in development and expects to begin preproduction on two early next year: “Men of Destiny,” a $90-million epic adventure to be directed by John Woo, and “Moon and the Sun,” a lower cost historical fantasy tale about a mermaid to be produced in association with the Henson Co. and Michael London and to star Natalie Portman.