Chernin Entertainment eying more production studios
Why it's the BFD: Dealmaking is rampant in Hollywood as the rise of streaming increases the demand for content.
The big picture: Several studios have been bought or received new financing over the past year.
- Blackstone-backed Candle Media has acquired Faraway Road Productions, Hello Sunshine, Moonbug Entertainment and a minority stake in Westbrook Inc.
- Apollo Global Management bought a minority stake in Legendary Entertainment.
- Stripes led a $225 million equity investment in A24.
Details: Chernin reportedly hired Centerview Partners and Moelis & Company last year to explore options, which included selling a minority stake to Carlyle.
- But Chernin has since focused on buying a studio. Red Arrow Studios is a network of international production companies. Its work includes the popular reality dating show "Love is Blind" on Netflix.
- Bloomberg reports that Chernin is profitable; had $50 million in earnings before interest, tax, depreciation and amortization; and is seeking a chief financial officer.
Catch up quick: Chernin has produced popular films like "Ford v Ferrari," "Hidden Figures" and the "Planet of the Apes" trilogy and TV series like "New Girl" and "See." It signed a non-exclusive first look film producing deal with Netflix in 2020.
The bottom line: "Because streaming services want to buy out so many of the rights to projects ahead of time, they guarantee a profit for the producer. That makes the earnings more predictable than in the hit-driven movie business of the past." — Lucas Shaw, Bloomberg