DreamWorks Animation Files for IPO

After weeks of speculation, DreamWorks L.L.C. today rocked Wall Street when it announced that DreamWorks Animation Inc. has filed a registration statement with the Securities and Exchange Commission for a proposed initial public offering of its Class A common stock.

With Shrek 2 taking in nearly half a billion dollars domestically and burning up the worldwide box office, DreamWorks Animation is rivaling Pixar in the CG feature business. When the privately owned animation unit goes public, it could also fetch share prices that match or exceed those enjoyed by Steve Jobs’ toon factory.

At last reporting, Pixar was trading at $69.10 per share. The maker of Toy Story, Toy Story, Monsters, Inc. and Finding Nemo, however, has an unblemished track record for hits, whereas DreamWorks has suffered a few blows with lackluster performers like The Road to El Dorado, Spirit: Stallion of the Cimarron and Sinbad: Legend of the Seven Seas.

The DreamWorks unit led by Jeffrey Katzenberg plans to deliver two animated features each year. The studio is hoping for another mega-hit of Shrek proportions when it releases Shark Tale on Oct. 1. The film stars the voice of Will Smith, who once again proved his star power over the weekend when his I, Robot took in a whopping $54 million to dethrone reigning box office champ Spider-Man 2.

Other hot talent lined up for future DreamWorks Animation releases include Ben Stiller, Chris Rock and David Schwimmer in Madagascar for Summer 2005 and Jim Carey and Garry Shandling in Over the Hedge for later in 2005. In addition to a full feature slate, the unit has the primetime series Father of the Pride coming to NBC this fall. The show stars John Goodman as the voice of Larry, the patriarch of a family of white lions working in Siegfried and Roy’s Las Vegas act.

There is no word yet on whether DreamWorks Animation stocks will be listed on the Nasdaq or the NYSE. Goldman, Sachs & Co. and J.P. Morgan Securities Inc. are serving as joint book-running managers of the offering, which is expected to raise $650 million for the studio.