SpringHill, the entertainment company co-founded by NBA star LeBron James, is selling a minority stake to a group of high-profile investors in a deal that values the business at $725 million, the companies said Thursday.
The size of the stake was not disclosed. The group of investors includes Nike, Epic Games, creator of the popular battle royale game “Fortnite,” private equity firm RedBird Capital Partners and Fenway Sports Group, the parent company of sports teams like the Boston Red Sox.
News of the transaction leaked this summer amid frenzied deal talks in the media space fueled by an insatiable demand for programming as streaming services expand. In recent months, Reese Witherspoon sold a majority stake in her production firm “Hello Sunshine” for $900 million, while Will Smith’s production company WestBrook held deal talks.
SpringHill, which is known for TV shows and movies such as “Space Jam: A New Legacy,” “The Shop” and “Shut Up and Dribble,” said it will use the cash infusion to launch new shows, expand its programming in new countries via licensing its programming and invest in emerging creators, among other things.
According to The Wall Street Journal, Carter and James, who serves as chairman of SpringHill, will remain largest shareholders with a supermajority of voting shares. The publication added that SpringHill is expected to generate more than $100 million in revenue over the year. SpringHill reportedly reached breakeven and is projecting revenues of between $150 million and $200 million in 2022.
For James, the deal will further strengthen his relationship with Nike, with which he inked a “lifetime” contract in 2015. Now, SpringHill will produce programming with Nike featuring athletes who have deals with the sneaker and sportswear company.
“We started this company with the tagline ‘More Than an Athlete’ which still defines everything we do to this very day,” said James’ business partner and SpringHill CEO Maverick Carter. “With this new group of investors who are the very best in their respective industries we are going to be able to empower our community and every creator to do their most inspiring work and achieve their most ambitious dreams.”
SpringHill, which was co-founded by James and Carter in 2008, said it will also produce shows for Epic Games and Fenway Sports Group as part of the deal.