Warner Bros Pictures has acquired domestic distribution rights to Terminator 3: The Rise Of The Machines after a bidding war over the last week that saw every Hollywood studio chasing the film which stars Arnold Schwarzenegger.

The deal was concluded between Warner and producers C-2 Pictures and Intermedia, which is financing the film and handles international distribution. Producers on the film are Mario Kassar, Andrew Vajna and Joel Michaels of C-2 Pictures with Hal Lieberman of Mostow/Lieberman Productions. Lieberman is partnered in Mostow/Lieberman with Jonathan Mostow, the director of the film.

The film is set to go into production in April 2002, with a release planned for summer 2003. Intermedia's co-chairmen Moritz Borman, Nigel Sinclair and Guy East will executive produce. The film is a C-2 Pictures/Intermedia production in association with Munich-based production entity IMF and Mostow/Lieberman.

"We had a very difficult time making the final decision on the domestic distributor but in the end, Warners pulled out all of the stops and committed the full support and extensive resources we wanted from the entire AOL Time Warner organization," said Kassar and Vajna.

"The depth and breath of AOL Time Warner was pivotal to procuring the deal we wanted commensurate with the stature and elements of Terminator 3," added C-2 finance chief Sam Falconello.

Ken Ziffren and Skip Brittenham of Ziffren, Brittenham, Branca & Fischer represented C-2 Pictures and Intermedia on the deal. C-2 and Intermedia expect to close the major international distribution deals for Terminator 3 before the end of the year. It was unclear at press time the status of existing foreign deals with VCL in Germany and Toho-Towa in Japan.

The project has been attracting attention for its budget - somewhere in the region of $160m, with a reported $30m going to Schwarzenegger - and for the race to rights which has included Paramount Pictures, DreamWorks SKG and Universal Pictures.

The deal also gives Warner Bros another mega-budget sequel for its 2003 lineup which already includes summer and winter openings for the first and second Matrix sequels respectively and possibly the third Harry Potter film.