Village Roadshow Entertainment Group, the company behind iconic franchises including The Matrix, Ocean's, and the Joker, has recently filed for bankruptcy protection in the United States, marking a significant shift in its business. The firm cited a tumultuous relationship with its former partner Warner Bros (WB) and a "failed and costly endeavour" into independent film production as key factors behind its financial woes.
According to a court filing submitted in Delaware, Village Roadshow plans to sell its extensive film library for approximately $365 million (£281 million) in an effort to alleviate its financial burdens. However, the company's debts are estimated to lie between $500 million and $1 billion.
The partnership between Village Roadshow and WB has been tumultuous, especially following the release of The Matrix Resurrections in early 2022, which debuted on HBO Max. Village Roadshow has alleged that WB sidelined it regarding rights to sequels and prequels linked to their previous collaborative work.
As Chief Restructuring Officer Keith Maib noted in court documents, the ongoing legal dispute with WB has led to incurred legal fees exceeding $18 million, most of which remain unpaid. This discord has irreparably damaged the relationship between the two companies, which historically served as a lucrative collaboration for Village Roadshow.
In addition, the firm has faced setbacks from a costly venture into independent filmmaking launched in 2018, where none of the produced films or series have seen profitable returns. The pandemic has further intensified difficulties for many US film companies, including Village Roadshow, particularly amid ongoing strike actions by Hollywood actors and writers that commenced in May 2023.
The Writers Guild of America notably barred its members from collaborating with Village Roadshow in December, claiming the company's inability to pay its contributors had crossed ethical lines. Among a challenging environment, Village Roadshow now prepares to navigate its future while seeking the potential for financial repair through new avenues.
