Entertainment One Takes Lead in Mark Gordon Joint Venture

Film rights and TV production company Entertainment One Ltd. said on Tuesday, Jan. 6, it would acquire an initial 51% stake in Mark Gordon Co. to create a joint venture to produce and finance TV and film content. Entertainment One, which is listed in London but based in Toronto, will buy the shares from a family trust for $132.6 million, including $5.1 million in Entertainment One stock. The deal gives Entertainment One the right to buy the outstanding 49% after seven years and secures the services of Mark Gordon, a TV producer behind hits including Grey's Anatomy, as part of a long-term employment agreement. Entertainment One said Gordon "brings to the venture deep active relationships with leading creative talent and all the major U.S. studios and networks." The financing will come from a $175 million extension to an existing loan arrangement and Entertainment One expects the purchase to boost earnings in the first full year. Mark Gordon Company had net profit of $13.2 million in 2013 and adjusted Ebitda of $30 million. Mark Gordon founded his eponymous company in 1987 and counts Saving Private Ryan among his feature film credits. "There is a voracious appetite for premium original content worldwide. In order to realise the true value of our content, retention of rights ownership and control of international distribution are absolute musts," he said in a statement, adding that the agreement offers an alternative to the "traditional studio way." Entertainment One President and CEO Darren Throop said the deal reflects the group's drive to tie up with content producers. The agreement follows its acquisitions of Force Four Productions and reality TV specialist Paperny Entertainment, both of Vancouver, last year. Entertainment One's advisers are JPMorgan Cazenove Ltd.'s Hugo Baring and Virginia Khoo, and Cenkos Securities plc's Stephen Keys. Its law firms are Osler, Hoskin & Harcourt LLP and Mayer Brown International LLP. Entertainment One is 27.1% owned by Marwyn Value Investors LP, which last year refinanced its credit facility. By late morning in London Entertainment One shares were up marginally at 310.4 pence, giving the FTSE 250 company a market value of £913.5 million ($1.39 billion). Read more from:

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