Hasbro's eOne Sells to Lionsgate for $500 Million

Lionsgate on Thursday announced that it acquired Entertainment One (eOne) from Hasbro, adding 6,500 titles to the Lionsgate library. Toy company Hasbro bought eOne for $4 billion in 2019, but will sell the Yellowjackets studio in a transaction valued at approximately $500 million. The deal is comprised of cash of $375 million subject to additional purchase price adjustments, and the assumption of production financing loans, according to a press release. The agreement is also subject to the Federal Trade Commission's premerger notification program, the Hart-Scott-Rodino ACT, and customary closing conditions. 

"The acquisition of eOne checks off all the boxes in areas that play to our core strengths," said Lionsgate CEO Jon Feltheimer.  "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."

Lionsgate is best known for its young adult blockbusters — the Hunger Games saga and the Twilight saga — as well as the hit Keanu Reeves-starring John Wick franchise. Lionsgate Television has produced such hit series as the Emmy-winning Mad Men and Orange Is the New Black, and it will bring The Continental: From the World of John Wick to Peacock this year.

eOne's 6,500-title film and television library includes the Oscar-winning Green Book and 1917; the films Atomic Blonde, The Woman King, and My Little Pony: A New Generation; and the long-running TV series Criminal Minds and Grey's Anatomy. Lionsgate's acquisition of eOne also includes the reality series Naked & Afraid, now in its 11th season on Discovery, The Rookie TV franchise, now airing its sixth season on ABC, its spin-off The Rookie: Feds, and production of Showtime's critically-acclaimed horror thriller series Yellowjackets.

Hasbro said the sale of eOne is part of its commitment to executing its Blueprint 2.0 strategy, which is "about significantly increasing investment in Hasbro's priority brands." 

Along with its Family Brands division — behind the eOne-produced children's series Peppa Pig and PJ Masks, as well as the animated series Transformers: EarthSpark and YouTube series My Little Pony: Tell Your Tale — Hasbro said it will retain "a focused team of creative development and business affairs experts" to shepherd the 30+ Hasbro-based projects in development, including ongoing development of the Transformers and GI Joe franchises at Paramount, Dungeons & Dragons, Magic: The Gathering, Play-Doh, and Hasbro's board game portfolio. However, Lionsgate has acquired the film development rights to Hasbro's Monopoly movie, based on the iconic board game.

"This sale fully aligns with our strategy, and we are pleased to bring the process to a successful close," said Hasbro CEO Chris Cocks. "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."

He continued: "Entertainment remains a priority for Hasbro. Hasbro will continue to develop and produce entertainment based on the rich vault of Hasbro-owned brands. We will also bring to life new original ideas designed to fuel all areas of Hasbro's blueprint including toys, publishing, gaming, licensed consumer products, and location-based entertainment. As part of the sale, we expect to move to an asset-lite model for future live action entertainment, relying on licensing and partnerships with select co-productions."

Hasbro said the transaction has been approved by both companies' Boards of Directors and remains subject to customary closing conditions, including the receipt of regulatory approvals. Hasbro will use the proceeds to retire a minimum of $400 million of floating rate debt by the end of the year, and for other general corporate purposes. The transaction is expected to close by the end of 2023.