It's Official: Legendary Entertainment Names Attorney Joshua Grode CEO
Nearly one year after Thomas Tull exited the studio he founded and later sold to China's Wanda for $3.5 billion, Legendary has a new leader — and "$700 million, give or take, of liquidity," he says.
After a lengthy search and protracted courtship, Legendary Entertainment finally has a new chief executive.
The studio behind Pacific Rim and Kong: Skull Island, owned by Chinese conglomerate Dalian Wanda Group, has hired attorney and veteran dealmaker Joshua Grode as its new CEO.
The Hollywood Reporter first reported that Legendary was courting Grode in August. He steps into the role left vacant by Legendary's founder Thomas Tull, who exited in January. Wanda's former senior vp, Jack Gao, served as Legendary's interim CEO until his own departure from the Chinese parent company in October.
Grode joins Legendary after a distinguished career at Los Angeles law firm Irell & Manella, where he was a partner and co-chair of the firm's transactions practice. During his tenure, he represented Legendary for years and later became a trusted confidant to Wanda and its billionaire chairman Wang Jianlin, advising on the Chinese conglomerate's $3.5 billion acquisition of Legendary in 2016.
Over the years, Grode also advised on Summit Entertainment's sale to Lionsgate and Disney's sale of Miramax Films to Colony Capital for over $600 million, among other high-profile transactions and financing deals.
“Josh is a longtime partner and advisor to Wanda, and most recently Legendary," said Lincoln Zhang, president of Wanda's Culture Industry Group, which comprises the conglomerate's entertainment assets. "His strong entertainment and financial acumen, relationships and understanding of the global growth opportunities that await Legendary will be indispensable."
Legendary's executive search — which for a time targeted former Fox chief Jim Gianopulos, who ultimately assumed the top job at Paramount — was complicated by a rough patch at its Chinese parent company. Wanda was among the hardest hit by Beijing's abrupt crackdown on debt-financed overseas dealmaking earlier this year, which lead to the abandonment of the conglomerate's planned $1 billion acquisition of TV producer Dick Clark Productions, as well as a hurried sale of the firm's Chinese hotels and theme parks for a combined $9.5 billion.
But Grode insists that Legendary is on solid financial footing, whatever the recent upheavals in Beijing.
"What has happened is that we have transformed the balance sheet," Grode says, adding that Legendary currently has "no debt and in excess of $700 million, give or take, of liquidity."
He adds: "That has come from a combination of investments by Wanda over a period of time, receipts from the film library that Legendary has and from Wanda converting the debt that was outstanding at the company into equity."
Perhaps better still for Legendary's long-term vitality was the news reported Nov. 29 by the South China Morning Post that Wanda had received permission to issue a bond in Hong Kong to raise capital offshore, possibly signaling a loosening of the leash on the company. Wanda's cash crunch continues, but the latest move suggests that Beijing is at least allowing Wang room to maneuver.
"I do see that as an encouraging sign," Grode says. Prior to China's Communist Party Congress in October, which cemented President Xi Jinping's hold over the country, "there was a general view that regulators wanted to preserve the status quo," he adds. "Now that the Party Congress is behind us, people are starting to look at new business again — and the pressing business that was out there is starting back up."
Grode's task at Legendary will be to skate out a new strategy for the next phase in Legendary Entertainment's evolution — particularly after the latest chapter was so closely associated with the big bets and hit-and-miss track record of Tull. Legendary began in 2005 primarily as Tull's financing entity, investing in big-budget projects like Warner Bros.' The Dark Knight as well as the lower-budget Hangover films. But in 2013, it became an independent studio based at Universal and suffered a string of flops, including Blackhat and The Great Wall.
Grode also must work to find ways to make strategic use of Legendary's ties to Wanda, whose considerable entertainment holdings in China and around the world include North America's largest film exhibitor AMC Entertainment and China's largest cinema circuit.
Prior to taking the role, Grode and Mary Parent, Legendary's vice chairman of worldwide production, met with Wanda's chairman Wang in Beijing to discuss the long-term strategy of the studio and how it fits into Wanda's broader portfolio. A shared long-term goal, Grode says, was to leverage Wanda's expansive physical infrastructure in China to the benefit of Legendary film properties, and to use Legendary intellectual property to drive customers and revenue back to Wanda's brick and mortar network across the Middle Kingdom.
"If you add up all of the things they have — the cinema chains, hundreds of shopping malls and kids' entertainment venues, and all of the theme parks that they still manage — you have the Wanda physical network," explains Grode, adding: "The idea that the IP that Legendary is creating under Mary could be the centerpiece to stitch together these various businesses and physical environments, creating opportunities to sell merchandise and capture customers in the digital environment — this is something Wanda would really like to see and that gets chairman Wang very excited."
Parent, former co-president of Universal Pictures and an esteemed producer of prestige fare like The Revenant, said Grode's hiring was integral to her decision to stay at the studio during the turmoil at Wanda, and in the wake of the departure of Gao, with whom she had worked closely.
"Josh has become my most significant thought partner on the content side of this business," she said. "Very few people have the insight and track record that he does from working with so many companies and platforms at the highest level of the business.”
Legendary currently has four films in varying states of production: Pacific Rim Uprising, Godzilla: King of the Monsters, the China-set Dwayne Johnson action pic Skyscraper and the Pokemon movie Detective Pikachu. The company also has a stake in Universal's Jurassic Park: Fallen Kingdom. Planned future titles include the "monsterverse" installment Godzilla vs. Kong and a Dune reboot directed by Denis Villeneuve.
Parent says Wanda's scale and sway in the world's soon-to-be largest movie marketplace also presents appeal to her as a working producer.
"Personally, I'm thrilled," she says. "Anyone who is in the film business right now is rooting for expanding marketplaces. And when you're making bigger films, they have to be able to play on that global level — China, and the shorthand we have because of Wanda, that's a huge asset."
"But it's not as though we are reverse engineering projects from that," she adds. "First and foremost, each content decision is about whether the story is worth telling. China just happens to be a marketplace where people really enjoy going to the movies right now, which is entirely great."