BEVERLY HILLS, CALIF., AUG. 16 -- De Laurentiis Entertainment Group Inc., which has been struggling for months after a string of box office flops, today filed for protection from its creditors under Chapter 11 of the federal bankruptcy law.
The move had been expected since Friday, when the company revealed that it had failed to negotiate a debt swap with bondholders.
The company, founded by Italian producer Dino De Laurentiis, has produced a number of films, including "King Kong," "The Bounty," "Crimes of the Heart," "Blue Velvet" and "Weeds," and the television miniseries "Noble House."
The company has sold assets and sought to restructure its debt to survive, but it did not list its assets and liabilities in its filing in bankruptcy court in Los Angeles. Although 1987 financial results have not been reported, the company estimated a $69 million loss.
De Laurentiis, who owns 61.9 percent of the company's stock, stepped down from management in February, giving management proxy voting control of his stake.
In a statement, De Laurentiis said: "I am profoundly saddened to hear that DEG has been forced into bankruptcy. I sincerely hope ... the company can be revived for the benefit of the shareholders, creditors and other investors."
After coming to the United States in the early 1970s, De Laurentiis was responsible for several movie successes, including "Serpico" and "Death Wish," before taking De Laurentiis Entertainment Group public with a stock offering in March 1986.
Films produced by the company that failed to reach theaters included the $25 million "Tai Pan" and the $21 million "King Kong Lives," a sequel to the "King Kong" remake. An attempt to promote "Million Dollar Mystery" by entering moviegoers in a million-dollar sweepstakes failed to bring potential viewers to the box office.
Another company strategy was to sell videocassette and pay-television rights to a movie before it was released, in hopes of reaching the break-even point before a movie hit the theaters. But the advance revenue often did not cover advertising and distribution costs, which can be as high as production costs.
The debt swap offer that failed last week would have dramatically reduced the company's $65 million bond debt by trading existing bonds for stock and bonds with terms more favorable to De Laurentiis. The company has not revealed how many of its bondholders agreed to accept the offer, other than to call the response disappointing.