Russo brothers’ business valued at $ 1.1 billion after gamemaker’s investment

Tokyo-based Nexon Co. is paying $ 400 million for a 38% stake in the Russo brothers’ film and television production company AGBO. (Jay L. Clendenin / Los Angeles Times)

AGBO, the film and television production company founded by “Avengers: Endgame” directors Joe and Anthony Russo, has secured a minority investment from a Tokyo-based video game maker as the companies pour money into the burning entertainment content space.

Game developer Nexon Co. is paying $ 400 million for a 38% stake in AGBO, valuing the downtown Los Angeles-based company at $ 1.1 billion, the companies said on Wednesday.

Nexon, best known for its huge free online games, is a major player in Asia, but it has gone unnoticed in the United States.

The investment in AGBO is part of a strategy to accelerate Nexon’s transition into the film and television industry and to strengthen its global profile, including with the American public. Nexon’s film and television offices are based in Beverly Hills.

On the Nexon side, the deal was led by Nick Van Dyk, an entertainment industry veteran who Nexon hired last year to lead its newly formed film and television division. AGBO CEO Jason Bergsman, who knew Van Dyk when they were both at Walt Disney Co., reached out and the two met several times over the summer and fall, which ultimately resulted in an agreement.

“It quickly became clear to both of us that a similar mindset with regard to the evolution of global entertainment franchises could provide really favorable ground for collaboration between our two companies,” Bergsman said in a statement. interview.

The agreement will strengthen AGBO’s ability to develop and produce new franchises, expand its intellectual property with interactive entertainment and co-financing projects.

AGBO is studying Nexon games it could develop into entertainment franchises. Nexon could also tap into AGBO’s intellectual property to develop new games, the executives said. AGBO co-founder and Russo production partner Mike Larocca said the companies expect to announce details of how they could collaborate in the coming months.

“Everything looks organic,” Larocca said. “There is nothing forced.”

Nexon has the opportunity to invest an additional $ 100 million in AGBO, upon request, during the first half of this year.

But Van Dyk, who previously held senior positions at Disney and Activision Blizzard, said it was important for AGBO to continue to be creatively independent. Nexon was comfortable with the arrangement as the two sides agreed on their vision for building popular franchises, he said.

“There are a lot of artist-run companies that make tiny, obscure little artistic films that aim to challenge and disturb audiences, and there is definitely a role for them in the media business,” Van said. Dyk. “But when you have people who see the intellectual property of the franchise and the creation of universes in a very similar way, we’re quite comfortable letting AGBO chart its own creative path. “

Hollywood is in the midst of a flurry of deals as investors and businesses try to gain an edge over the competition for content as audiences quickly consume movies and series on streaming services. Demand has given rise to astronomical valuations.

Last year, LeBron James and Maverick Carter’s SpringHill Co. struck a private equity deal valuing their company at $ 725 million. Hello Sunshine by Reese Witherspoon sold to an entity backed by Blackstone, valuing the “Big Little Lies” shingle at $ 900 million.

Tuesday, Will Smith and Jada Pinkett Smith sold a minority stake in their Westbrook Inc. company to a Blackstone-funded company called Candle Media, which is run by former Disney executives Tom Staggs and Kevin Mayer.

The Russo Brothers are well positioned for the franchise-obsessed era in Hollywood. They are best known for making some of the most popular films in the Marvel Cinematic Universe for Disney, including “Captain America: Civil War”, “Avengers: Infinity War” and “Avengers: Endgame”. The latter, released in 2019, grossed $ 2.8 billion at the global box office. They also directed Tom Holland’s 2021 much smaller drama “Cherry,” which was released on Apple TV +.

Founded in 2017, AGBO is known for offerings such as the Netflix action film “Extraction,” starring Chris Hemsworth. A sequel is on the way. It’s also the company behind Chris Evans-Ryan Gosling’s upcoming big-budget action thriller “The Gray Man,” directed by the Russo Brothers for Netflix.

Nexon’s gaming franchises include “Dungeon Fighter,” which has grossed more than $ 18 billion to date, according to the company. It also publishes the South Korean game “MapleStory” and has developed the series of racing games “KartRider”. The company acquired a games studio in Stockholm in 2019, with the aim of expanding beyond Asia.

This story originally appeared in Los Angeles Times.

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