Lionsgate and Hasbro said on Thursday that they reached a deal for the media company to buy eOne, the toy giant’s film production company, for $500 million.
The deal includes $375 million in cash. The rest will involve Lionsgate assuming production financing loans for ongoing projects.
As part of the pact, Lionsgate also will acquire film development rights to Hasbro’s “Monopoly,” based on the enduring board game. Kevin Hart was cast to star in the film in 2019.
Wall Street was positive on the deal. Lionsgate shares edged up less than 1% in premarket trading, despite buyers typically seeing shares dip when a deal is announced. The stock closed at $7.98 Monday, up about 25% since the start of the year.
Hasbro shares rose about 2% in premarket trading after closing Wednesday at $64.37.
Hasbro has been shopping eOne, which co-produces films and television based on Hasbro IP as part of a production deal with Paramount, for months. The sale follows a series of cost-cutting measures at the company, including layoffs that saw 20% of its staff cut earlier this summer.
The toymaker bought eOne in 2019 in a $3.8 billion all-cash deal, giving it access to a cache of highly rated brands, including “Peppa Pig,” “Clifford the Big Red Dog” and more.
The company said it will retain a creative development team “and business affairs experts “to shepherd the 30+ Hasbro-based projects in development,” including the “Transformers” and “GI Joe” franchises, “Play-Doh,” “Dungeons and Dragons” amd “Magic: The Gathering” and Hasbro’s board game portfolio.
“The acquisition of eOne checks off all the boxes in areas that play to our core strengths,” said Lionsgate CEO Jon Feltheimer in a statement. “It will be immediately and highly accretive, adds a world-class library with thousands of properties, strengthens our scripted and unscripted television business and continues to expand our presence in Canada and the UK.”
“The deal is the culmination of our long-standing relationship with the immensely talented team at eOne, and it continues to build our position as one of the world’s leading independent content platforms with a stockpile of great intellectual properties and a unique, non-replicable portfolio of assets,” he added.
Recent releases from the production house include the films “Dungeons & Dragons: Honor Among Thieves” and “Transformers: Rise of the Beasts,” as well as TV shows like Showtime’s “Yellowjackets.”
The deal, which is subject to regulatory approval, will see Lionsgate acquire a content library that includes nearly 6,500 titles, from Sam Mendes’ World War I saga “1917,” to 2019 Oscar winner “Green Book,” along with popular series like “The Rookie,” television stalwarts like “Grey’s Anatomy,” and “Criminal Minds,” and realty programming like “Naked & Afraid.”
Hasbro’s interest in the Canadian film & TV operations of Entertainment One Canada is also part of the deal.
“This sale fully aligns with our strategy, and we are pleased to bring the process to a successful close,” said Hasbro CEO Chris Cocks in a release. “Lionsgate’s management team is experienced in entertainment and adept at driving value, and we’re glad to have found such a good home for our eOne film & TV business. We look forward to partnering with them, especially on a movie adaptation of Monopoly.”