Legendary Closes $275 Million Financing Deal

Legendary pictures Logo - H 2012

Legendary pictures Logo - H 2012

UPDATED: The deal includes $128 million in new financing from both existing backers and new investors.

Legendary Entertainment, the production company that has financed such pictures as The Dark Knight and the just-released Wrath of the Titans, has closed equity and debt financing deals totaling about $275 million.

Legendary will use the proceeds to retire and refinance its debt and to provide additional working capital as the company expands beyond financing movies for Warner Bros. into producing its own movies. It also plans to expand in television, digital media, publishing and other areas, according to an announcement Wednesday.

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The deal includes $128 million in financing from new investors including Google executive Eric Schmidt’s Tomorrow Ventures, Morgan Stanley Investment Management and Peter Thiel’s Thiel Capital.

Those who already had invested in Legendary and participated in the new equity financing include Jim Breyer and Breyer Capital and Accel Partners, IDG Capital Partners and Gordon Crawford.

Investment bank Goldman, Sachs & Co. acted as sole agent for Legendary in the equity financing.

Another $150 million has been raised in debt arranged by JPMorgan, Bank of America, Royal Bank of Canada and UBS, all of which served as co-lead bankers on the transaction.

Separately, the company said that its partnership in Legendary East will announce its financial and distribution plans later this year. The spinoff company designed to finance English-language movies made in China tried to raise $220 million late last year on the Hong Kong stock exchange but was unable to close the transaction.

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Legendary Entertainment was founded by Thomas Tull in 2004 after he raised some $500 million on Wall Street to invest in big studio movies.

In 2005, Legendary made a deal to co-produce and co-finance movies with Warner Bros. Those have included Inception ($823 million gross worldwide), The Hangover and its sequel (more than $1 billion worldwide for the two films combined), Clash of the Titans ($493 million worldwide), The Dark Knight ($1 billion worldwide), and 300 ($456 million worldwide).

Of nearly two dozen movies made with Warners to date, some were not successful, including Lady in the Water (2006), Observe and Report (2009) and Jonah Hex (2010).

 Legendary said its upcoming movies with Warners include Pacific Rim; Jack the Giant Killer; and the third of Christopher Nolan's Batman movies, The Dark Knight Rises, due for release in July.

Among the wholly owned projects in development are an adaptation of the interactive game universe Warcraft; Godzilla, based on the Toho Co. character; Seventh Son, directed by Sergei Bodrov; Warren Ellis’ Gravel; and Mass Effect, based on Electronic Arts’ and BioWare’s video game franchise.