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Hello Sunshine, Reese Witherspoon’s media company that has produced content for streaming services like Hulu, Apple, and HBO, among others, has been sold to a new, unnamed media company run by former Disney executives, Kevin Mayer and Tom Staggs, the company announced. this morning.
The Wall St. Journal first reported on the sale.
Terms of the deal were not officially disclosed, but it appears the sale values Hello Sunshine’s business at around $ 900 million, according to the WSJ. The outlet previously reported that Hello Sunshine was exploring a sale after receiving interest from a number of suitors, including Apple.
Hello Sunshine was co-founded by Witherspoon and Strand Equity founder and managing partner Seth Rodsky in 2016, and is best known for producing shows like HBO’s “Big Little Lies”, Hulu’s “Little Fires Everywhere” and “The Morning Show. “from Apple. who feature Witherspoon in leading roles.
But the company has also invested in other film and media projects, ranging from the Facebook Watch series to collaborations with Amazon’s Audible. He now has upcoming film and TV projects with Netflix, Amazon, ABC and Starz, and recently announced a Kids & Animation division as well as the acquisition of SKR Production from Sara Rea to expand into unscripted content.
In addition, the company operates an online and mobile book club app, Reese’s Book Club, which now has 2.1 million subscribers. The club’s most popular picks are often turned into shows and movies that Hello Sunshine will produce later.
According to Hello Sunshine’s announcement, the company will be the first acquisition of the new media company led by Mayer and Staggs, which is backed by private equity firm Blackstone. The company is spending more than $ 500 million in cash to buy shares of Hello Sunshine from its investors, including AT&T and Emerson Collective, the WSJ noted.
After the transaction closes, the management team will continue to manage the day-to-day operations of Hello Sunshine. Witherspoon and Hello Sunshine Managing Director Sarah Harden will join the board of the new company and retain significant shareholders in the new company.
Hello Sunshine will become the cornerstone of the company’s new media strategy, which will involve being “an independent and friendly home for cutting-edge, high-quality, category-defining brands and franchises,” it says. he.
“Today marks a great time for Hello Sunshine. I created this company to change the way all women are seen in the media. Over the past few years, we have seen our mission flourish through books, television, movies and social platforms Today we are taking a big step forward by partnering with Blackstone, which will allow us to tell even more entertaining, impactful and illuminating stories about the lives of women around the world. I couldn’t be more excited about what this means for our future, ”Witherspoon said in a statement about the deal.
The deal comes at a time when there is a slight increase in consolidation in the media sector, as companies adjust to the shift from traditional TV and standard movie releases to the ever-active world of streaming and video streaming. cord cutting. For example, Amazon announced in May that it would buy MGM Studios for $ 8.45 billion – a deal being investigated by the FTC for possible antitrust issues. Meanwhile, WarnerMedia and Discovery announced at around the same time their intention to merge their businesses, hoping to take a bigger share of the streaming market. Now Comcast and ViacomCBS are also exploring ways to work together.
But as traditional media companies start broadcasting, like NBCU did with Peacock, for example, they are also removing licensed content from other streamers, like Netflix. This is driving demand for new sources of independent programming, like what Hello Sunshine produces.
The company’s value in this market comes from its pipeline of quality projects, many of which are pre-approved by its book club members, which serve as an integrated audience and fan base for the film or subsequent TV release. . What’s more, the projects it supports are also those that tell women’s stories – a historically neglected segment of the market, and whose Hello Sunshine success proves there is an outstanding demand among viewers.
Blackstone’s investment in the new company is through its private equity business, which previously acquired a controlling stake in the Bumble dating app. Blackstone has also made other investments in the entertainment industry, including the SESAC music rights organization; a Hollywood studio and office property portfolio in Burbank; global theme park operator Merlin Entertainments; the Ancestry.com online genealogy platform; the online mobile advertising platforms Vungle and Liftoff; and Epidemic Sound, which provides music for Internet content creators.
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