In a strategic move, Hasbro has inked a deal to sell its eOne television and movie business to Lionsgate for approximately $500 million US. This transaction comes just four years after Hasbro’s acquisition of eOne for $4 billion.
Under the terms of the agreement, Lionsgate will pay $375 million in cash and assume production financing loans as part of the acquisition. The purchase will provide Lionsgate with access to eOne’s extensive library of nearly 6,500 titles, including renowned shows like Grey’s Anatomy, Yellowjackets, and The Woman King. Moreover, Lionsgate will gain film development rights for Monopoly, a cinematic project based on the iconic board game from Hasbro. Chris Cocks, Hasbro CEO, expressed his enthusiasm for the collaboration, stating, “We look forward to partnering with them, especially on a movie adaptation of Monopoly.”
The acquisition offers Lionsgate, based in Santa Monica, California, an opportunity to expand its operations in the U.K. and Canada. The company has recently initiated production partnerships with prominent entities like BBC Studios, Channel Four, CBC, Rogers’ CityTV, and Bell Media. Hasbro initially acquired Entertainment One Ltd. in 2019 through an all-cash deal valued at around $4 billion. At that time, the focus was on eOne’s preschool brands, which included beloved characters like Peppa Pig and PJ Masks. Notably, Hasbro will retain ownership of the family brands division, enabling it to maintain access to popular properties like Peppa Pig and PJ Masks.
Based in Toronto, Entertainment One’s growth was fueled by a series of acquisitions over the past 15 years, including the acquisition of Alliance Films in 2013. The company’s origins trace back to the music distributor Records on Wheels, which eventually transformed into Entertainment One in 2005.
This sale marks the culmination of Hasbro’s efforts to divest a portion of eOne’s television and film business that did not align with its core branded entertainment strategy. The transaction has received the approval of the boards of both Hasbro and Lionsgate and is projected to conclude by the end of the year.
Proceeds from the sale will be employed by Hasbro to retire a minimum of $400 million in floating rate debt by the year’s end. Concurrently, Hasbro disclosed its financial performance for the second quarter, revealing a loss of $235 million, or $1.69 per share, which is a departure from the profit reported in the same period the previous year. Despite this, Hasbro managed to exceed Wall Street’s revenue estimate of $1.11 billion by recording a 10% revenue decline to $1.21 billion.
Shares of Hasbro experienced a marginal increase in midday trading.