Wall Street's downturn has hit Hollywood Boulevard with two major talent agencies, William Morris and Endeavor, engaged in merger talks that would create an 800-pound gorilla in film, television, music and publishing. The major sticking point of a union is "issues of control," according to the Los Angeles Times.
The potential merger is just another sign of the times. William Morris and Endeavor are looking to adapt to a shrinking economy. They see discretionary income falling with people having less money to spend on entertainment such as DVDs, movies and books, which is putting pressure on their bottom lines. William Morris and Endeavor also believe that a merger would create a formidable competitor large enough to compete against Creative Artists Agency, Hollywood's largest dominate talent broker.
But for all the pros of a merger, the naysayers point to some stumbling blocks such as ambivalence of major principles of each company toward a deal because it would dismantle their individual fiefdoms. The Los Angeles Times reports:
"Endeavor has made it clear in negotiations that it would consider a merger only if the firm's four managing partners -- Emanuel, Patrick Whitesell, Rick Rosen and Adam Venit -- remain in control of the combined entity. William Morris' Wiatt is expected to take on a chairman-like role."
Should they strike a deal, the bottom line of the combined companies could be boosted from the elimination of redundant positions.
For now, the merger talks are like a script in progress with a general concept and the details being fine tuned. If all goes like both sides hope, the Los Angeles Times points out this may "increase pressure on other talent agencies such as CAA, ICM and United Talent Agency -- to embrace or gobble up smaller firms." - Gerald Magpily
See Los Angeles Times article
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