McDonald's is no longer the exclusive house for Mickey Mouse. The fast-food giant now has eyes for a green, swamp-loving ogre by the name of Shrek.

Oak Brook-based McDonald's Corp. said Wednesday that it is ending its practice of entering into long-term exclusive promotional agreements, like the much-maligned one it is close to ending with The Walt Disney Co.

Beginning in 2007, McDonald's will instead gain access to tie-ins with movies from DreamWorks Animation SKG. The agreement will kick off with a major promotion for Shrek 3.

The DreamWorks arrangement lasts for only two years, so McDonald's has a clear picture of the movies that are under production during the term of the deal. And it's non-exclusive, meaning the fast-food giant could join with DreamWorks' competitors to promote movies, too.

That is definitely a win for McDonald's, said Janna Sampson, director of portfolio management at Oakbrook Investments in Lisle, which holds more than $32 million in McDonald's stock. If someone else does have a hit, they have opportunity to go out and try to get a deal. McDonald's felt like it got burned on the Disney deal.

It's important. It not only drives Happy Meal business, it brings the parents along, he said. It can mean the difference between a month where you show a sales increase and month where you don't, he said.

The DreamWorks deal will begin in January 2007, immediately after the Disney arrangement expires. It includes an option to renew after two years.

DreamWorks Animation is the publicly traded offshoot of the movie studio founded in 1994 by David Geffen, Jeffrey Katzenberg and Steven Spielberg. It releases two animated features a year.

Lisa Howard, spokeswoman for Oak Brook-based McDonald's, declined to comment on the financial details of the DreamWorks deal.

McDonalds' promotions for Shrek and other DreamWorks features will include Happy Meals with special boxes and figurines.

Howard said the company would also pursue promotions aimed at older customers, noting that Shrek appeals to an audience beyond young children. These are going to be all-family promotions, she said. That's one of the beauties of Shrek. It has a wide appeal to a variety of different audiences.

DreamWorks will produce animation for some McDonald's commercials.

Source: The Chicago Tribune