Hasbro is selling its eOne TV and movie business to Lionsgate in a roughly $500 million US deal, after paying $4 billion for the company four years ago.
Hasbro said Thursday that the deal with Lionsgate includes $375 million in cash and the assumption of loans to finance production.
The acquisition will give Lionsgate access to eOne’s library of nearly 6,500 titles, including Grey’s Anatomy, yellow jackets and the king woman.
Lionsgate will also receive the film development rights to Hasbro’s Monopoly, based on the popular board game.
“Lionsgate’s management team are experienced in entertainment and adept at driving value, and we’re pleased to have found a good home for our eOne motion picture and television business,” Hasbro CEO Chris Cocks said in a statement. “We look forward to partnering with them, especially on a Monopoly film adaptation.”
The deal allows Lionsgate, the Santa Monica, California-based company, to continue to scale its operations in the UK and Canada, where it recently launched production partnerships with BBC Studios, Channel Four, the CBC, Rogers’ CityTV and Bell Media.
Hasbro bought Entertainment One Ltd. in 2019 in an all-cash deal valued at around $4 billion. At the time, Hasbro was interested in eOne’s preschool brands, which included Peppa Pig and PJ Masks. Hasbro will retain ownership of the Family Brands division, so it will continue to have access to Peppa Pig and PJ Masks.
Toronto-based Entertainment One has grown through a series of acquisitions over the past 15 years, including Alliance Films in 2013. Its roots go back to defunct music distributor Records on Wheels, which became Entertainment One in 2005. .
The sale is expected to close this year.
While Hasbro had high hopes for the deal, in November it announced it was looking to sell the part of eOne’s movie and TV business that didn’t directly support its branded entertainment strategy.
The boards of Hasbro and Lionsgate have approved the transaction, which is scheduled to close by the end of the year.
Hasbro said it will use the proceeds from the deal to retire a minimum of $400 million of floating-rate debt by the end of the year.
The toy company also reported its second-quarter financial results on Thursday. Hasbro lost $235 million, or $1.69 a share, in the period, reversing a gain a year earlier.
Pawtucket, Rhode Island-based Hasbro’s revenue fell 10 percent to $1.21 billion, beating Wall Street’s estimate of $1.11 billion.
Hasbro shares were up slightly in midday trading.