Banijay Closes Endemol Shine Acquisition, Forming Global Production Giant

Big Brother - Holly Alexander, Kathryn Dunn and Jackson Michie - Publicity-H 2019
Courtesy of Monty Brinton/CBS

The French TV production firm closed its $2.2 billion acquisition of the 'Big Brother' producer to create a global production titan that will be the largest TV producer outside the U.S.

French TV production company Banijay Group, backed by French media and telecom giant Vivendi, has closed its acquisition of Endemol Shine from Disney and Apollo Global Management, creating a global production titan that will be the largest TV producer outside the U.S.

Sophie Turner Laing, CEO of Endemol Shine, said she was leaving now that the deal was closed.

Banijay and Endemol recently received European Union anti-trust approval to complete the mega-merger, which will create a new international production giant. The takeover combines Banijay's entertainment and reality-TV franchises, including Keeping Up With the KardashiansSurvivorTemptation Island and Wife Swap, with Endemol Shine's library of unscripted hits, among the Big BrotherMasterChef, Deal of No Deal, and scripted fare like Black MirrorPeaky Blinders, The Bridge and Broadchurch. Together, Banijay and Endemol Shine have production library that dwarf major U.K. players such as Fremantle, BBC Studios and ITV Studios.

The combined group will be controlled by Banijay shareholders LDH —made up of Financière LOV, De Agostini and Fimalac, the investment company of Marc Ladreit de Lacharrière—and the French media giant Vivendi. LDH holds 67.1 percent of the new group, Vivendi 32.9 percent.

With the takeover, Banijay, will diversifying its revenue streams by expanding its scripted business —currently the French group has only a handful of big drama productions in its slate, including Versailles— and boosting its global reach. The merged firm will have nearly 200 production banners in 23 territories across Europe, the U.S., Asia and Latin America and a catalog of nearly 100,000 hours of content. Production subsidiaries include Kudos (Broadchurch), Fifty Fathoms (Netflix's The Eddy), Rubicon (Beforeigners) and Bunim/Murray Productions (Keeping Up With the Kardashians).

Banijay, led by CEO Marco Bassetti, had already called itself "the world's largest independent content creation group for TV and multimedia platforms" after various acquisitions over the years before striking a late October deal with Endemol Shine for around $2.2 billion. The combined powerhouse's 2019 revenue was estimated at about $3.3 billion. 

"The close of this unique deal represents the joining of two businesses built on entrepreneurialism, creativity and people," Bassetti said on Friday. "Aligned in thinking, and approach, we now stand together as the world’s largest international content creation and distribution group. Expanding our catalogue and investment in high-quality, multi-genre IP, extending our footprint significantly, and welcoming a number of new world-class creatives, we hope to become a go-to for clients,
and home for the best talent to create the most innovative and fresh scripted and non-scripted programming."

Banijay completed a refinancing drive in February, raising €2.3 billion ($2.5 billion) from European and U.S. investory to bankroll the Endemol Shine deal. The company listed the details of the financing, which include €575 million in senior secured notes due 2025; $403 million in senior secured notes due 2025; €400 million in senior notes due 2026; a €453 million term loan B facility, a $460 million term loan B facility; and a €170 million (equivalent) multi-currency Revolving Credit Facility.

When announcing the deal, Banijay said it would be financed through a capital increase at Banijay Group and debt financing, including a full refinancing of Banijay and Endemol Shine’s existing debt. Deutsche Bank, Natixis and Société Générale are backing the refinancing effort. As of December 2018, Banijay’s and Endemol Shine’s respective debt was approximately $486 million and $1.83 billion.

In anticipation of the deal, Banijay has been busy setting up its executive team for the new, merged company. It recently named Cathy Payne, a former Endemol Shine executive, the new CEO of Banijay Rights, the company's international sales arm, and appointed John Richards, who worked with Payne at Endemol,  CFO of the group. Roisin Thomas will remain COO of the unit.

Analysts see room for cost cuts, and layoffs, from merging the firms’ sales and corporate operations. But they also see the chance for the independent producer to supply content to streaming services, traditional networks and others.