07 MEDIA talk | FLEXIBLE, VERSATILE, RESILIENT
GLOBAL MEDIA M&A
CONTINUED
South Korea and Japan, two countries that were hailed for their ability to quickly rollout impressive test and trace systems limiting the impact of COVID-19 on their populations, also saw the highest levels of M&A activity. Both countries came close to rivalling the UK for overall volumes, but with an almost exclusively domestic bent. While China saw relatively few deals, Chinese investors were not side-lined. STX Financing, an entertainment company known for medium- budget, star driven content, has found some success with projects including Molly’s Game, Bad Moms and The Upside, amongst other film and TV productions. In April, existing investors in STX Financing, including TPG Capital, Liberty Global, Hony Capital and Tencent Holdings, announced a deal for a 15% stake in Eros International in an all-stock deal worth USD $125 million. Eros International, a UK-based Indian film production company, has a strong foundation in the Indian film market, but has also faced some struggles of late.
However the impact was felt most sharply in the sub USD $100 million deal category, whereas larger deals remained fairly consistent year-on-year. Even risk capital is not immune to the heightened uncertainty that has arisen because of the pandemic and this may have unduly affected start-ups and seed rounds, but with larger rounds remaining consistent investors clearly have not shied away from offering funds for support, development and expansion. In contrast, the Asia Pacific continued to improve its share of global deal volumes. Sitting in second place as both a target and acquirer region, the Asia-Pacific saw its share of global deal volumes increase by 3% as a target region (26%) and 1% as an acquirer region (28%) when compared to 2019. That said, the region saw primarily domestic deals, with some intra-regional activity but little engagement beyond. Only 7% of acquisitions by Asia-Pacific companies were made beyond the region.
The merged company will be publicly listed on the New York Stock Exchange (NYSE) as Eros STX Global Corporation, with the intention of straddling two major film markets in Hollywood and Bollywood. In addition, the company will hope to leverage Eros’ streaming capabilities. Eros Now, the first Indian service to be available on Apple TV to the Indian market, already boasts more than 188 million subscribers and more than 26 million paid subscribers.
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