Bloomberg News

Disney Said to Plan About 5% Staff Cuts at Film Studio Unit

June 06, 2011

(Updates with November reorganization in fourth paragraph.)

June 6 (Bloomberg) -- Walt Disney Co. will cut about 200 jobs at its film division, or 5 percent of the workforce, said two people with knowledge of the plans, as the company realigns distribution and relies more on production from Marvel and Steven Spielberg’s DreamWorks Studios.

The reductions at Walt Disney Studios will be made during the week of June 13, said the people, who asked for anonymity because the decision hadn’t been made public. The unit has about 5,000 employees, including Marvel and Pixar.

Disney, which makes the “Pirates of the Caribbean” movies, is shifting its release slate toward Marvel and films distributed for Spielberg’s DreamWorks Studios, which makes its own movies. The company restructured its worldwide distribution operation last year.

Production, distribution, business development and other positions are being eliminated, the people said. Some cuts have already been made, said one of the people.

In November, Disney merged groups responsible for film and television distribution. The organization is responsible for physical and digital home-video sales.

Disney, based in Burbank California, acquired Marvel in January 2010 for $4.2 billion. The company bought back distribution of two Marvel films from Viacom Inc.’s Paramount, the third “Iron Man” and next year’s “Avengers.”

DreamWorks, co-founded by Spielberg and Chief Executive Officer Stacey Snider, hired Disney in 2009 to distribute about six films a year.

Disney, also owner of theme parks and ESPN, gained 2 cents to $39.40 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have climbed 5 percent this year.

--Editor: Anthony Palazzo

To contact the reporters on this story: Ronald Grover in Los Angeles at rgrover5@bloomberg.net; Andy Fixmer in Los Angeles at afixmer@bloomberg.net

To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net


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