France's Banijay to Acquire Endemol Shine, Creating TV Production Giant

Courtesy of Netflix
'Peaky Blinders'

Walt Disney and Apollo Global Management currently own the producer of hit shows such as 'Big Brother,' 'MasterChef,' 'Black Mirror' and 'Peaky Blinders.'

Endemol Shine Group, the producer of hit shows such as Big BrotherMasterChefBlack Mirror and Peaky Blinders, has agreed to be acquired by French production powerhouse Banijay Group.

The deal — formally announced on Saturday — creates a new production giant, with almost 200 production shingles in Europe and the U.S., as well as the rights for close to 100,000 hours of content. Upon announcing the deal, Banijay said that total pro-forma revenue of the combined group is expected to be approximately €3 billion ($3.3 billion) for the year ending Dec. 31.

No price tag was included in the acquisition announcement, but when rumors of the impending deal broke earlier in the week, the figure was reported at $2.2 billion. 

Endemol Shine has been owned by Walt Disney, which acquired 21st Century Fox's 50 percent stake in the firm as part of its $71.3 billion takeover of large parts of the company, and private equity group Apollo Global Management. 

The acquisition will be financed through a capital increase of Banijay Group and committed debt financing, which includes a committed full refinancing of Banijay and Endemol Shine’s existing financial debt, supported by Deutsche Bank, Natixis and Société Générale. Post-closing, the combined group will be held by LDH (67.1 percent), a holding company controlled by Financière LOV, Stéphane Courbit’s investment arm, and Vivendi (32.9 percent).

Banijay, led by CEO Marco Bassetti, was founded 11 years ago and is one of the largest independent TV producers. Its production banners include Keeping Up With the Kardashians producer Bunim Murray Productions, Stephen David Entertainment and Banijay Studios North America, which this year unveiled it would produce the game show Don't with Ryan Reynolds for ABC in the U.S., as well as Popstars maker Screentime in Australia and Survivor producer Castaway Television in the U.K. The company is owned by LOV Group and DeA Communications, with Vivendi also owning a stake. 

At the MIP TV market in Cannes this year, Bassetti talked about his interest in getting his hands on more scripted and English-language content. "The English-speaking market is the most attractive market because today there is a lot of appetite for English-speaking tape," said the exec. "When you launch a show in the U.S. or the U.K., it has a different type of attraction in other countries." He also said: "Scripted is a key genre. We grew 30 percent this year, and our goal is to grow more because there is space and appetite."

“Endemol Shine brings an incredible array of industry-leading talent, globally-renowned brands and high-quality creative content," Bassetti said in a statement on the deal's announcement. "Combining the resources of these two companies will instantly strengthen our position in the global market, and our capabilities across genres will further define us as a go-to provider of first class IP worldwide. Welcoming the Endemol Shine brands and talents to our existing business will signal enhanced opportunities in the marketplace, and we are all excited by what the future holds for the combined entity." 

Late last year, Fox and Apollo called off a sales process for Endemol Shine. Banijay was understood to have been in advanced talks to buy the company back then, but the owners were understood not to be happy with the price tag and decided to instead focus on fueling the continued growth of Endemol Shine.

Lionsgate, Sony, Liberty Global/Discovery Communications' All3Media and talent agency Endeavor were among the companies previously understood to have circled the group. U.K. TV giant ITV was also initially thought to be in contention, but after weeks of intense press speculation the company said it had no intention of submitting a bid. RTL Group's FremantleMedia also backed out of negotiations during the initial financial discovery stage.

The owners of Endemol Shine, led by CEO Sophie Turner Laing, have long touted the production firm's strong cash flows and financial growth. They have in recent years invested to grow the firm's scripted production business, among other things.

At a conference organized by Enders Research earlier this year, Turner Laing highlighted changes in the TV production business that larger companies can take advantage of. "What we are seeing, and what as all content producers are capitalizing on, we are working on a global scale now," she said. "Having watched English language being so dominant for such a long time, the whole new generation moving forward are just interested in great stories, they do not mind whether it is in Brazilian, or German or Spanish or whatever. And because we are based in 23 countries, it means we have this great network out there that we can literally pick up these ideas and try and cross-fertilize."

In a statement as part of the Banijay acquisition, Turner Laing said: “At Endemol Shine, we have continually inspired and entertained audiences around the world, a testament to every single person across the Group. This deal takes us into a whole new and exciting chapter and into a new enhanced global content house with many opportunities ahead."

Endemol Shine was created via a merger between two global reality juggernauts, Dutch group Endemol (Big Brother) and Elisabeth Murdoch's British group Shine (The Biggest Loser). The two came together in 2014 through the merger of Apollo's Endemol and Fox's Shine Group.