NEWMARKET ACQUIRED BY NEW LINE, HBO.

Byline: Greg Hernandez Staff Writer

Newmarket Films, the independent distributor that struck box office gold with ``The Passion of the Christ'' last year, will be acquired by Time Warner-owned New Line Cinema and HBO Films, the companies announced Wednesday.

The new distribution company is expected to be merged with New Line's current specialty label, Fine Line Features, to distribute a slate of modestly budgeted independent films funded by New Line and HBO Films as well as the theatrical distribution of outside acquisitions.

The price of the deal was not disclosed but James C. Goss, an analyst with Barrington Research, said at least the elements of the deal seem solid.

``The way a distribution entity can work most effectively is to make sure there is a lot of product to push through the pipeline,'' Goss said. ``Not only do they produce their own but they acquire others.''

The new, jointly owned, theatrical distribution company has yet to be named.

It will operate autonomously and be run by former Newmarket Films President Bob Berney, who has developed a stellar reputation in recent years for identifying unexpected blockbuster hits including ``Passion'' and ``My Big Fat Greek Wedding'' as well as the critical favorites ``Y Tu Mama Tambien,'' ``Donnie Darko'' and ``Memento.''

``Bob has a remarkable track record in independent film distribution, and with this new partnership HBO and New Line hope to provide him with the support necessary to build a very successful independent film distribution company,'' HBO President and Chief Executive Officer Chris Albrecht said in a statement.

Newmarket Films was formed just three years ago by partners William Tyrer, Chris Ball and Berney as the distribution arm of Newmarket Entertainment Group.

Since then, it has released ``Passion,'' which was passed on by several major film studios, as well as such critically acclaimed films as ``Monster,'' which won the Best Actress Oscar for Charlize Theron, and ``Whale Rider,'' which earned a surprise Academy Award nomination for star Keisha Castle Hughes.

``The sale of the unit to HBO makes considerable sense: that unit has proven themselves in the market against the speciality units of the studios,'' Tyrer said. ``The boom in that market has seen independents effectively becoming mini-majors, where costs, while attractive to studios, can still be prohibitive to the creative nature of indie film.''

The new company will be based in the current offices of Newmarket Films in New York and will report to New Line co-Chairman and co-CEO Michael Lynne and Colin Callender, president of HBO Films.

In a statement Wednesday, Berney praised his new partners in the venture.

``The pedigrees of both HBO, which has demonstrated its great passion to filmmaking and storytelling, and New Line Cinema, with its brave and cutting-edge history, combined through this new entity creates not only a great opportunity for my team at Newmarket, but also a tremendous new outlet for filmmakers and audiences alike,'' he said.

Greg Hernandez, [phone]

greg.hernandez(at)dailynews.com

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(color) ``Whale Rider,'' distributed by Newmarket, starred Keisha Castle-Hughes, who was nominated for an Oscar for best actress.