Relativity Media said it has closed $350 million round of debt financing on Thursday, finalizing a deal that has been buzzed about this week.
The studio said it will use the cash to fund future film projects.
As reported earlier in TheWrap, Relativity turned to a familiar backer — Ron Burkle — to bolster its funding. Relativity said that the billionaire investor's Colbeck Capital advised the company, structured the deal and participated in the overall transaction.
Burkle loaned the movie studio $200 million last November through Colbeck at a time when Relativity was feeling financial pressure related to the rollout of its sword-and-sandals epic "The Immortals" and its Snow White film "Mirror, Mirror."
“This marks a significant step forward for Relativity and firmly positions us for exciting new endeavors. We are thankful to our passionate partners for all of their efforts and support,” Relativity’s CEO Ryan Kavanaugh said in a statement.
Also read: Ron Burkle Rides to Relativity’s Aid With $250M in Debt Financing
As part of this deal, a new board of directors, which is majority controlled by company CEO Kavanaugh (pictured), was created. The board includes Burkle, along with Colbeck partners Jason Colodne and Jason Beckman, as well as other individuals that the studio did not name.
While the cash infusion is no doubt welcome, the latest debt financing does place added pressure on the company to make its upcoming movies profitable. The loan carries an interest rate of about 10 percent, an insider told TheWrap previously.
Among the films that Relativity has in the pipeline are the horror thriller "House at the End of the Street" with "The Hunger Games" star Jennifer Lawrence, a film adaptation of Nicholas Sparks’ best-selling novel "Safe Haven" and crime drama "Out of the Furnace with Christian Bale.
MESA Global advised on the capital raised.