YuuZoo Invests $50 Million in 1st of 3-Part Deal to Buy Relativity

Investment schedule will give Singapore company majority stake within a year

Last Updated: October 31, 2016 @ 4:47 PM

Singapore-based e-commerce platform YuuZoo on Monday made the first of three planned investments to purchase Ryan Kavanaugh’s Relativity Studios.

According to a filing at the Singapore stock exchange, YuuZoo will invest $50 million for a one-third stake in Relativity Studios.

It’s the first of three investments in a deal worth up to $300 million, according to an individual close to the deal, and will give the Asian company majority control of Ryan Kavanaugh’s 12-year-old company which emerged from bankruptcy last March.

As TheWrap reported exclusively last week, the deal is subject to regulatory approval.

The insider said the YuuZoo acquisition would be structured as follows: a first tranche of $50 million at a $150 million valuation; a second tranche of $50 million at a $200 million valuation, triggered after six months and subject to regulatory approval; and an option for a third tranche of $100 million at a $200 million valuation at 12 months from the original investment — giving the company a post-investment valuation of $300 million.

Representatives for Relativity Studios and YuuZoo did not immediately return TheWrap’s request for comment.

YuuZoo’s ownership of Relativity would be capped at 80 percent, according to the individual.

On Friday, TheWrap’s exclusively reported on the deal, which will include the studio’s existing library of 40 movies, a half dozen more currently in production and a lucrative output deal with Netflix. The package also includes Relativity’s interest in RED, a joint international distribution venture with EuropaCorp.

The sale is an impressive feat for Kavanuagh, who extracted his core film business from the wreckage of Relativity Media’s Chapter 11 process that began in July 2015, emerging from bankruptcy in March.

YuuZoo went up against two other companies in a bidding war: tech company Lenovo, owned by Chinese investment group Legend Holdings, and another publicly traded Chinese company. Kavanaugh also attracted interest from American studios.

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