LeBron James' Hollywood ambitions are getting a major financial alley-oop.
James' entertainment firm, the SpringHill Co., has secured a private equity-led investment to fuel the Los Angeles Lakers star's growth in film, TV, video games, consumer products and live events.
The SpringHill Co. on Thursday said it has made a deal for a group led by New York-based RedBird Capital Partners to acquire a significant minority stake in the company, known for shows including "The Shop" on HBO and the recent Warner Bros. film "Space Jam: A New Legacy."
Participants in the deal include Boston Red Sox owner Fenway Sports Group, apparel brand Nike and "Fortnite" maker Epic Games. The deal values Los Angeles-based SpringHill at $725 million.
Other financial details of the transaction were not disclosed, but people familiar with the terms said the RedBird-led group will own nearly half of the company and put in nine figures' worth of capital to grow the business, with the potential for more money later on. James, who serves as the company's chairman, and Chief Executive Officer Maverick Carter will still have a controlling stake.
Carter, a longtime friend of James from their Akron, Ohio, days who has managed the star's business dealings for years, said the capital infusion will allow SpringHill to produce more of its own content, invest in new intellectual property and acquire other firms, including production companies.
"We'll be able to finance our own projects," Carter said over Zoom. "We're going to build up our physical production arm so we'll be able to finance and control the production of the things we make, so when we talk about empowering creators, we can really leave creators in control."
The company expects to surpass $100 million in revenue during the next 12 months, according to Carter, up 67% compared with the last 12 months, when SpringHill generated about $60 million in sales.
Last year, Carter and James raised $100 million for SpringHill from investors including Sister, the production company of Elisabeth Murdoch, Stacey Snider and Jane Featherstone, and Guggenheim.
The SpringHill deal is the latest high-profile production company investment amid a gold rush for content in the entertainment industry. Media companies have been hungry for content to build streaming services with fresh shows and movies.
Reese Witherspoon's Hello Sunshine, the entity behind "Big Little Lies," in August received a majority investment from the firm formed by ex-Disney executives Kevin Mayer and Tom Staggs and private equity giant Blackstone, valuing the firm at more than $900 million. Amazon is trying to acquire James Bond producer Metro-Goldwyn-Mayer Studios for $8.45 billion, pending regulatory approval.
"Moonlight" producer A24 and "Dune" studio Legendary Entertainment have all been subjects of recent deal speculation.
SpringHill was a logical fit for RedBird Capital, founded in 2014 by former Goldman Sachs partner Gerry Cardinale, who has known Carter and James for more than a decade.
RedBird is heavily invested in sports and entertainment, with a portfolio that includes investments in YES Network, the regional sports network of the New York Yankees; David Ellison's Skydance Media; and XFL, which it owns with Dany Garcia and Dwayne Johnson. RedBird is also a shareholder in Fenway Sports Group, which in addition to the Red Sox owns the Liverpool Football Club and Boston's Fenway Park. James and Carter became partners in Fenway earlier this year.
SpringHill has been entertaining deal talks since at least July. Fenway was in deal talks with SpringHill when it brought Cardinale to the table, Carter said. Cardinale quickly saw the potential to build SpringHill's business, and a deal came together in just a couple months.
"The goal is to create a multibillion-dollar diversified culture and content company, and I think that puts it in a pretty unique position," said Cardinale, founder and managing partner at RedBird. "It's not just capital; it's listening to Maverick and LeBron in terms of what they want to build, where they've taken the company from a standing start to today, and then saying what the potential trajectory is."
The pact is the latest boost for SpringHill, which was already one of the best known of a handful of content companies started by sports stars. Golden State Warriors' Stephen Curry has Unanimous Media and Brooklyn Nets' Kevin Durant co-founded investment and media company Thirty5 Ventures.