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Fox, who beat off competition from Sony, is to assist with both distribution and marketing in the international and domestic markets for franchises like Shrek, Madagascar, Kung Fu Panda and How to Train Your Dragon.
Under the new agreement, Fox will receive a distribution fee on worldwide theatrical and home video releases – dependant on gross profit. They will also stand to benefit from certain international television and digital deals.
DreamWorks Animation CEO Jeffrey Katzenberg said in a statement: “Fox Co-Chairmen Jim Gianopulos and Tom Rothman have built a world-class distribution team, and we are excited to apply their expertise, robust infrastructure and global resources so that DreamWorks Animation’s films can reach their fullest possible potential over the next five years,”
The animation studio have been seeking a new distributor since they announced they were ending their association with Paramount in August 2011, after the studio’s board of directors rejected a proposal from Paramount to extend its distribution pact for another year. Dreamworks’ upcoming feature Rise of the Guardians will be the final film released through Paramount.
According to TheWrap, negotiations with Paramount broke down after they demanded more than the eight per cent fee it made in the original pact.
Katzenberg said: ”Starting in 2013, DreamWorks Animation content will be distributed in the more traditional markets under a fee structure that is similar to our existing arrangement with our current distributor.
“However, our new agreement with Fox presents more favorable economics overall for DreamWorks Animation because we are taking advantage of lower costs associated with the emerging digital distribution landscape and managing domestic television distribution in-house.”
Dreamworks’ upcoming projects include The Croods, Turbo and sequels to How to Train Your Dragon and Kung Fu Panda, which will now fall to Fox.