Hasbro has officially confirmed the sale of Entertainment One (eOne) to Lionsgate for $500M, a deal that is expected to be finalized by the end of this year. The news comes after weeks of speculation, with FilmmakerFocus reporting that Lionsgate was in the lead to acquire the majority of eOne’s studio, including projects like “Woman King” and “Yellowjackets.” This announcement coincided with Hasbro’s Q2 earnings call.
It’s worth noting that Hasbro originally purchased eOne for $4B in 2019, but will now sell it for just $500M. The sale includes $375M in cash, subject to certain purchase price adjustments, and Lionsgate will also assume production financing loans. Both companies’ Boards of Directors have approved the transaction, but it is still subject to closing conditions and regulatory approvals. Hasbro plans to use the proceeds from the sale to retire at least $400M of floating rate debt by the end of the year.
Hasbro CEO Chris Cocks expressed satisfaction with the sale, stating, “This sale fully aligns with our strategy, and we are pleased to bring the process to a successful close.” He praised Lionsgate’s management team for their experience and ability to drive value, and expressed excitement about future partnerships, particularly in relation to the upcoming movie adaptation of Monopoly.
As part of the deal, Lionsgate will acquire eOne’s scripted and unscripted TV production, film production, global distribution, a vast content library of over 6,500 titles, and Hasbro’s interest in eOne’s Canadian film and TV business. However, Hasbro will retain the Family Brands division, which includes popular properties like “Peppa Pig” and “PJ Masks.”
In anticipation of the sale, eOne has undergone several rounds of layoffs in recent months, affecting approximately 20% of its film and television staff. Hasbro had previously announced plans to cut 15% of its global workforce this year, resulting in around 1,000 job losses. Additionally, eOne made the decision to close its theatrical operations in the UK.
Meanwhile, Lionsgate is in the process of separating its film and TV studio from Starz. It’s worth noting that Lionsgate’s vice chair, Michael Burns, sits on the Hasbro board.
J.P. Morgan and Centerview Partners served as lead financial advisors to Hasbro in this transaction, while Cravath, Swaine & Moore LLP, Mayer Brown International LLP, and Stikeman Elliott LLP are acting as legal counsel to Hasbro. Osler, Hoskin & Harcourt LLP are acting as legal counsel to eOne Canada Limited.
