Motion Picture Daily (Jan-Mar 1954)

4 Motion Picture Daily Tuesday, February 9, 1954 Hughes Offer for RKO Assets (Continued from page 1) Hecht-Lancaster, UA1 Sign Two-Year Pact; Seven Films Slated New Spirit in U. S. Industry, Executives Report After Visits By PETER BURNUP LONDON, Feb. 8.— James E. Perkins, Paramount's managing director here, and C. J. Latta, A.BP.C.'s managing director, returned from visits to the United States filled with infectious enthusiasm over the improvement in industry conditions and outlook there. "Business over there is definitely on the up-grade but what is most encouraging is the enthusiastic approach to the future and the long-term planning that is being clone," Perkins said. He added that his company, all of whose recent productions have been filmed on a picture composition of 1.66-to-l, in future will adopt the wider ratio of 1.85-to-l. He said also that Paramount is introducing a stereophonic sound system under which distributed sound can be projected on a single track. Seeks Greater Flexibility "We believe that the old ratio is dead," he said. "We are adopting the even wider ratio with a standard composition of 1.85-to-l. "This will allow still greater flexibility so that the picture can be presented in dimensions between 1.66-to1 and 2-to-l or over. But they will not suit the old 4-by-3 screen, because Paramount believes that theatres universally will be going over to wider standards." Perkins described Paramount's dou/ ble frame system employing a technique in which the negative travels laterally through the camera and in which two conventional 35-mm. frames are used as one. This is then reduced to the standard 35mm. film for the release prints. The Paramount chief suggested that the technique not only assists composition but means also that when the positive is optically reduced for the projection print, the grain on the negative virtually disap. pears, giving a much finer photo graphic result. Will Suit All Theatres He confirmed that all Paramount pictures on this system would have an optical single stereophonic sound track so that release prints will suit theatres with existing sound equipment as well as those fitted with stereophonic channels. "M-G-M is using a similar principle," Perkins added, "but I do not know yet whether ours and theirs are compatible." Latta, the other returning American, was as emphatic and enthusiastic as Perkins. Latta declared that the upgrade mood was to be discerned in every section of the industry in America; producers, distributors, exhibitors. Television, he claimed, has found its level in the U. S. "It's no longer the bogey it was," he said. "People there have got over the initial panic stage of TV-itis." WB Not Selling, He Says Latta gave an emphatic denial to rumors that Warner Brothers contemplate disposing of their considerable holdings in A.B.P.C. He quoted Sam Schneider, Warners' vice-president, as saying : "Warners are very proud of their interests in A.B.P.C. They are definitely not for sale," stockholder of RKO1 Pictures since 1948, said that he decided on the figure of $6 because "I would like to feel that I have given all stockholders of RKO Pictures Corp. an opportunity to receive for their stock an amount in excess of its market value at the time when I first became connected with the company, or at any time since." Officers and directors of RKO Pictures could not be reached here for comment yesterday. President James R. Grainger is on the Coast, while J. Miller Walker, vice-president and general counsel, was in Georgia recuperating from an illness. Deadline Is Monday According to the terms of the Hughes offer, the plan must be accepted by the board of directors not later than 6:00 P.M. next Monday and approved by a majority of stockholders other than himself at a meeting convened not later than March 30 and adjourning not later than 6:00 P.M. March 31. The assets would then have to be transferred to him from the corporation not later than 10:00 A.M. April 2. In making the offer to give every stockholder a pro rata portion of the $23,489,478, Hughes pointed out that he had been sued by certain stockholders and accused of responsibility for losses of the corporation. He also pointed out that there have been expressions of dissatisfaction among the stakeholders and his offer to purchase ail'lr.e assets of the company furnishes f|ij opportunity" to stockholders to get' more for their stock than the market value. Now Owns 1,262,120 Shares Hughes, who now owns 1,262,120 shares of the 3,914,913 shares outstanding, said Ae would vote all of his stock in favor of a resolution to accomplish the following ":" "RKO Pictures will, in reduction of its capital, pay $6 in cash per share for all shares . . . tendered for redemption during the 60-day period following the adoption of this resolution, or during such longer period as may be considered Cinerama (Continued from page 1) exhibition and production rights for the process. The other cities in which Cinerama is playing are Philadelphia, Boston, Pittsburgh and San Francisco. By Jan. 1, the nine-city estimated gross for Cinerama was put at $6,500,000. Since that time another $2,000,000 was said to have been added. Cinerama was unveiled for the first time in New York on Sept. 30, 1952. Slated to attend tomorrow's premiere in St. Louis are Sam Rosen, executive vice-president of S-W, Harry Kalmine, vice-president and general manager ; Nathan Lapkin, vice-president ; Harry Goldberg, advertising and publicity director, and Arthur Rosen, an assistant to Lapkin. Start '.Cinerama Holiday' "Cinerama Holiday'" is the new title for the Cinerama production which Louis de Rochemont is now shooting in the United States and Continental Europe. The title has been chosen by Stanley Warner Corp. to replace the desirable by the company's attorneys." Two minority suits, one in Nevada and the other in New York, have accused Hughes of "mismanagement," charging that huge losses have been suffered by the company under his leadership. RKO Pictures reported a net loss of $10,178,003 in 1952 and a deficit of $3,739,113 for the nine months ended Oct. 3, 1953. . Tax Ruling Reported Factor Speculation in trade quarters yesterday was plentiful on what may have motivated the Hughes' offer besides the announced reasons. Some quarters attributed the offer to provisions in the tax laws under which a company that loses money in one year can use that loss to reduce its taxable income in any of the five succeeding years, thus allowing a money-losing concern, if merged with a money-making concern such as the Hughes Tool Co., to be used to offset the profits of the latter. The unpredictable Hughes in offering to purchase all of the RKO Pictures' assets takes a position almost directly the reverse of the one he occupied little more than a year ago when he sold his controlling stock interest in the company to the Ralph Stolkin-A. L. Koolish syndicate. Made Million-Dollar Profit Hughes made $1,000,000 profit on that deal after the purchasing group met reverses and decided not to complete their payments to Hughes. He also recovered his stock in the company and added to it recently when he exchanged shares in RKO Theatres for picture company shares held by Albert List, when the latter acquired voting control of the theatre company. Following the opening of the New York Stock Exchange yesterday, it took until noon before a quotation was established, with the first sale reportedly a block of 200,000 shares at $5.38. Following that, trading was very active with a total of 487,200 shares being traded. The closing price quotation was $5,125, representing a rise of $2.25 during the course of the I day. Duffy Case (Continued from page 1) theatres, and failing that, set up its own theatre in Mangum. Due to master contracts that Griffith had with the distributors, the Duffy theatres were no longer able to get films, the appeal said. Finally, in April, 1938, "faced with certain ruin," Pat Duffy was forced to sell his two theatres to Griffith, the court was told. Duffy signed a statement releasing all claims against Griffith and also agreed not to operate any other theatres in the locality. In June, 1951, Duffy Theatres filed a damage suit against Griffith, but the District Court and the Tenth Circuit Court of Appeals said the sale was a release of all claims against Griffith and threw out the Duffy suit. The appeal to the Supreme Court followed. original "Thrill of Your Life." One production crew now is on location in Arizona, while de Rochemont and another group are en route to Switzerland, where an episode will be shot at St. Moritz. Burt Lancaster and Harold Hecht, ! for Hecht-Lancaster Productions, j have concluded with United Artists a two-year production-distribution contract under which a minimum of seven Hecht-Lancaster films, with an overall production cost of approximately $12,000,000 will be released by UA. The agreement was reached in Los Angeles over the weekend, culminating a series of conferences attended by Arthur B. Krim, president of UA; Robert S. Benjamin, chairman of the board, and Robert F. Blumofe, vice-: president in charge of West Coast; operations. One Film Completed The seven films on the 1954-1955 Hecht-Lancaster schedule for United Artists are : "Bronco Apache," western with color in Technicolor, starring Lancaster and Jean Peters, which is completed and being readied for release ; "Vera Cruz," with color in Technicolor, co-starring Gary Cooper and Lancaster, which is set to go into ; production on location in Mexico \ next month ; "The Way West," film I version of A. B. Guthrie Jr.'s Pulitzer I Prize-winning novel, in which Lancaster will share stellar billing with five others, and "The Gabriel Horn," I a story of the pioneering West. Also "Trapeze," starring Lancaster in the film version of Max Catto's novel ; "Marty," the television prize 1 play which its author, Paddy Chayevsky, is fashioning into a motion picture, and "Operation Heartbreak," based on Alfred Duff Cooper's adventure novel, to be filmed abroad in association with Sir Michael Balcon and the J. Arthur Rank Organization. In addition, the contract provides that other properties may be included. Memphis Ban (Continued from page 1) a "borderline" picture, and the three women members of the board wanted to ban it and "I went along with them." Avery Blakeney, attorney, the other male member of the board, did not attend the screening. Blakeney has not attended a screening since it wag revealed that he and Binford were noil in harmony on censoring pictures. J Kessler in OSU Film Post COLUMBUS, O., Feb. 8.— Walter Kessler, manager of Loew's Ohio, has been named motion picture consultant to the Ohio State University Theatre Collection, by Dr. John H. McDowell, director of the theatre division of Ohio State's speech department. In this capacity, Kessler will assist in locating and acquiring motion picture stills and documentary material to add] to the collection. 'Riot' Runs 80 Mins. The running time of Walter Wanger's Allied Artists production, "Riot in Cell Block II," was inadvertently omitted from the review of the fil" in yesterday's Motion Picture Dailj. The running time is 80 minutes. The film was classified as suitable for general audiences.