Disney Buying Lucasfilm for Over $4B

Disney expects to release new Star Wars films 'every two to three years'

In this image released by Lucasfilm Ltd., Warner Bros. Pictures, a scene from the animated film "Star Wars: The Clone Wars," is shown,
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Mickey Mouse, Captain America, and Chewbacca are all about to live under the same roof. Today, the Walt Disney Company announced that it is buying Lucasfilm Ltd. from George Lucas, the company's founder and sole owner, in a transaction valued at $4.05 billion.

"It makes sense, not just because of our brand compatibility and previous success together, but because Disney respects and understands—better than just about anyone else—the importance of iconic characters and what it takes to protect and leverage them effectively to drive growth and create value," said Disney CEO Robert Iger in a conference call late on Tuesday.

Lucas, meanwhile, framed the transaction as a way to prolong the Star Wars legacy.

"For the past 35 years, one of my greatest pleasures has been to see Star Wars passed from one generation to the next," Lucas said in a release announcing the deal. "It's now time for me to pass Star Wars on to a new generation of filmmakers. I've always believed that Star Wars could live beyond me, and I thought it was important to set up the transition during my lifetime."

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Of course, Disney views the deal not only as a boon for Lucasfilm but as a long-term revenue-generator. In this deal, Disney acquires Lucas' effects companies, Industrial Light and Magic and Skywalker Sound, alongside the Star Wars franchise. The company expects that Lucasfilm will generate around $215 million in licensing revenue in 2012.

That income should only go up in years to come. The release of Star Wars: Episode 7 is planned for 2015. As it has already been seven years since the release of the last Star Wars movie, Revenge of the Sith, Iger said that Disney believes "there's substantial pent-up demand" for further Star Wars films. Iger reported that Disney has big plans for the Star Wars franchise, with Episodes 8 and 9 already on the more distant horizon.

"Our long-term plan is to release a new Star Wars feature film every two to three years," he said in the conference call.

Those films could make this transaction very profitable. According to Disney CFO Jay Rasulo, the last three Star Wars movies would have averaged an estimated $1.5 billion at the box office in today's dollars, adjusting for inflation and taking into account revenues from 3D and international growth.

The plans extend beyond film, as well.

"We also expect to utilize Star Wars in other businesses including Parks & Resorts, in games and in our television business," said Rasulo in Tuesday's call.

As for Lucas, the plan is not to simply ride off into the sunset with $4 billion in cash and stock in hand. He will remain on as a consultant. Meanwhile, Kathleen Kennedy, currently the co-chairman of Lucasfilm, will become the company's president.

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Danielle Kurtzleben is a business and economics reporter for U.S. News & World Report. Connect with her on Twitter @titonka or via E-mail at dkurtzleben@usnews.com.