Tokyo game creator Nexon buys production company from directors Marvel
takes a minority stake in AGBO, the production company co-founded by “Avengers: Endgame” directors Joe and Anthony Russo, the two sides said on Wednesday, giving the game developer a foothold in the rush for Hollywood content companies.
Tokyo-based Nexon said it would invest $ 400 million for a 38% stake in AGBO, which produced Netflix Inc.
hit “Ripping” and has several film and television projects in development on streaming services.
The transaction values AGBO at $ 1.1 billion, and AGBO has the option to request an additional $ 100 million from Nexon during the first half of 2022.
The deal does not oblige either company to produce movies or games using the other’s intellectual property, but executives from both have said they will look for opportunities to work together. Nexon will get two seats on AGBO’s board, but the Russos and their executives will continue to own a majority of the company and control the board.
AGBO is the latest independent production company to benefit from a wave of funding, showing how the age of streaming has dissolved the boundaries of funding for entertainment that seeks global audiences. Through the deal, Nexon’s games and properties could be adapted to AGBO’s film and television projects. Both companies hope to replicate the Russo Brothers’ success in franchise adaptations to Walt Disney Co.
Marvel Studios, signaling Hollywood’s continued focus on blockbuster entertainment that can sell tickets, toys and more.
The deal follows a series of investments capitalizing on increased production driven by Wall Street’s adoption of streaming services at major studios and tech giants like Apple. Inc.
and Amazon.com Inc.
Last summer, Reese Witherspoon’s Hello Sunshine was sold to a company backed by Blackstone Inc.,
a move that effectively put a “for sale” sign in front of similar entities.
Since then, the children’s entertainment company Moonbug Entertainment Ltd. was bought out by the same Blackstone-backed company, which this week also bought a 10% stake in Westbrook Inc. from actor Will Smith for around $ 60 million. SpringHill Co., the entertainment company co-founded by basketball phenomenon LeBron James, unlocked a stake in October. Similar deals are expected to follow, according to investors and production company executives.
Some of Nexon’s brands are relatively unknown in the United States, but popular in parts of Asia with games such as “Dungeon & Fighter” and “MapleStory”. The company is focused on games and immersive worlds that can take years to explore, CEO Owen Mahoney said.
The company’s expansion into film and television follows the hiring of Nick van Dyk, a former executive in Disney’s corporate strategy division and head of film and television division at Activision Blizzard Studios. Mr. van Dyk runs Nexon Film and Television.
AGBO, which the Russos co-founded in 2017 with Mike Larocca, has had a mixed record with a few releases, such as the action thriller “21 Bridges” and the war drama “Cherry”. Its list of upcoming projects includes several of the big-budget action movies Netflix and other services produce to rival the big screen, such as “The Gray Man” with Ryan Gosling as a rogue CIA agent. .
A spokeswoman for private company AGBO declined to provide detailed financial results for the studio. The company was profitable in 2021, according to a person familiar with the matter, and the combined budgets for its productions have approached $ 1 billion in the past year.
Although he co-directed one of the most lucrative theatrical releases of all time, “Avengers: Endgame,” Joe Russo said joining a video game company made more sense after watching the likes of his. four children, all under the age of 25. “A movie theater is not necessarily the main source of entertainment for them,” he said.
Nexon negotiated a potential tuna tartare and salad deal last summer at the Bel-Air hotel in Los Angeles, according to those involved in the deal. AGBO CEO Jason Bergsman met with Mr. van Dyk and discussed their common interests, including creating immersive fictional worlds and using technologies like Epic Games Inc’s Unreal Engine. In September, Nexon offered AGBO an investment, which AGBO referred to an investment bank that was in discussions with many potential investors on its behalf.
“It has become clear that our companies have a similar mindset about the future of franchise entertainment, which has good potential for us to work together,” said Mr. Bergsman.
The deal, which values AGBO at $ 900 million before cash, does not guarantee Nexon the right to acquire a controlling stake in AGBO, according to a person familiar with the matter.
AGBO plans to use part of Nexon’s capital to develop new film and television franchises, Bergsman said. The money will allow AGBO to hold a larger stake in some of its productions, especially some that are slated for theatrical release and potentially video games, he said.
Write to Erich Schwartzel at firstname.lastname@example.org and Benjamin Mullin at Benjamin.Mullin@wsj.com
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