Dune Capital's Steven Mnuchin Takes Stake in Relativity, Becomes Co-Chairman

Ryan Kavanaugh Headshot - H 2014

Ryan Kavanaugh Headshot - H 2014

The Warner Bros. financier takes a stake is helping to buy Elliott Management's debt.

Dune Capital's Steve Mnuchin is getting into business with Relativity. The head of the film financing company that has inked co-financing deals with Warner Bros. and, previously, Fox Filmed Entertainment, is partnering with Kavanaugh and a group of investors to buy a significant portion of debt and equity owned by Elliott Management.

Mnuchin is also joining Relativity's board as a non-executive co-chairman, assisting the company on strategic issues and its capital structure as it approaches a potential IPO in 2016. Relativity CEO Ryan Kavanaugh remains the company's largest individual shareholder, and Elliott will continue as a minority investor.

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Financial terms of the transaction were not disclosed.

“Steven has been a trusted advisor for years, and I personally recruited him to join our board," Kavanaugh said in a statement. "He brings an unrivaled perspective on the ever-increasing value of content in Hollywood and Wall Street, and his experience will prove invaluable as we continue moving toward an IPO.”

Mnuchin added: “I’ve known Ryan for several years and have closely followed Relativity’s success. I am thrilled to become an investor in the company and join the board. I look forward to working with Ryan and the management team as they continue to build a global media company that is redefining what it means to be a content creator in the 21st century.”

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Mnuchin and Dune last year partnered with Brett Ratner and Australian billionaire James Packer on a $300 million deal to fund Warner Bros.' upcoming movie slate. The deal gave Warner Bros. a replacement for its longtime financing partner Legendary Entertainment, which left for Universal last year as well.

Dune previously did several slate financing deals with Fox, backing movies like The Devil Wears Prada, Live Free or Die Hard and Avatar, but in 2013 the studio closed a $400 million deal with former Dune partner and veteran financier Chip Seelig through his new company, The Seeling Group, and hedge fund Magnetar Capital

Roughly 10 years ago, Dune and Relativity were somewhat rivals in the film-financing world with the latter inking co-financing deals with Universal and Sony while Dune remained in business with Fox.

In January 2012, Ron Burkle acquired most of the equity interest in Relativity that was held by Elliott Management and joined the board along with Colbeck Capital partners Jason Colodne and Jason Beckman.