It has been a rough month for Jeffrey Katzenberg.
In the space of a few weeks, the mogul and co-founder of DreamWorks Animation SKG Inc. has been rebuffed by three high-profile potential buyers: Japanese telecommunications giant SoftBank Corp., Rupert Murdoch's 21st Century Fox and Hasbro Inc.
Katzenberg, known for driving a hard bargain, may have overplayed his hand. The studio executive was said to be pursuing a deal worth about $3 billion — about $1 billion above the company's current market value. In the case of Hasbro, investors also balked at the idea of getting into the volatile movie business and the company risked alienating its main licensing partner, Walt Disney Co.
The collapse of deal talks left some Wall Street analysts wondering what Katzenberg's strategy is. ...
The strategy is what it's been for years.
Cash out at a big profit.
I'm told that back in the ought sixes and sevens, Mr. Katzenberg was after a buyout along the lines of the Disney-Pixar deal, but that didn't happen. And then along came the crash of '08-'09, and any potential DreamWorks Animation suitors were in short supply. (Because the suitors were focused on surviving, not purchasing a cartoon studio.)
So now here we are, a whole lot further down the Log Flume of Life, and Jeffrey Katzenberg is again pushing to sell DWA. If I were to hazard a guess as to why things aren't currently going well (and I'm about to), I would say that Jeffrey is
A) Overly optimistic about the price he can command;
B) Pushing a wee bit too hard for a bigger price-per-share in negotiations;
C) Getting undone by competitors who have more leverage than he does. (Can we spell D-I-S-N-E-Y? I knew we could.)
I still think DreamWorks Animation will find a bigger fish willing to swallow it, I just don't know when that might be. So I'll hold fast to my "within 36 months" prediction.