JP Morgan is serving as administrative agent on a $350 million senior credit facility in connection with the merger of Eros International and STX Entertainment.
The combined company will be called Eros STX Global Corporation and will produce feature length films and episodic content. The combined company, with $125 million of incremental equity, will feature a revamped capital structure and liquidity position at close with $264 million of pro forma net debt, $195 million of pro forma cash balance and $120 million of available revolver capacity as of December 31, 2019.
Citigroup Global Markets is serving as financial adviser to Eros International and Gibson, Dunn & Crutcher is serving as its legal adviser. PJT Partners is serving as financial adviser to STX Entertainment and Kirkland & Ellis is serving as its legal adviser.
Eros International is a global Indian entertainment company that acquires, co-produces and distributes Indian films across formats such as cinema, television and digital new media.
“We are thrilled to join with STX Entertainment as this represents a landmark step in our company’s transformation. We are already at an inflection point as we move to a more consistent, stable and high growth revenue profile with our digital over-the-top (OTT) platform. This merger will not only fuel our growth, but will also diversify our underlying sources of revenue and subscribers with a truly global play, building a powerhouse between east and west. We are well positioned to create long-term value for our shareholders, partners and employees,” Kishore Lulla, executive chairman and CEO of Eros International, said. “Collectively, we will have a unique capability to present our film and episodic libraries and pipeline of original content to a broad and growing global audience through multi-year output deals, strategic alliances and our market-leading Eros Now streaming platform.
“This company will be financially strong and uniquely positioned to compete immediately thanks to its global footprint, strong revenue and recapitalized balance sheet, including a large new equity commitment. These significant investments and no meaningful debt maturities in the near-term enable the company to pursue strategic investments in key growth areas, including traditional and digital distribution, film acquisition, TV production and development of original episodic content.”
Founded in 2014, STX Entertainment is an independent studio focused on producing, marketing, owning and distributing film and television content for global audiences across traditional and digital media platforms.
“The combination of our two companies creates the first truly independent media company that deeply integrates the expertise and creative cultures of Hollywood and Bollywood,” Robert Simonds, executive chairman and CEO of STX Entertainment, said. “Kishore is a legend in the Indian entertainment industry and a pioneer in OTT content development and distribution in India. Together we will have the relationships, management expertise and resources to create new content and grow rapidly in the largest and most attractive global markets. On day one, we will have the ability to tap into our significant combined libraries, and draw upon our deep relationships with A-list actors, directors and producers across the globe to create even more compelling content for millions of consumers.”
