Neon to North Road: Mid-Market M&A Frenzy Is About to Ignite
Dealmakers name companies ripe to be bought or buy (even as the ghost of Candle looms): ‘There is such an appetite to scale’
I cover agents, lawyers and top dealmakers for paid subscribers. I interviewed WME’s indie film co-head Deborah McIntosh, wrote about top Q2 deals plus M&A predictions for Q3 and reported on the state of TV pacts including the scoop on Apple’s new backend for writers.
“Now that Paramount-Skydance is behind us and no longer dominating the M&A conversation, I’ll take a look at the market for smaller studios and production companies,” I thought, foolishly, earlier this month.
Instead, David Ellison’s company ensured its omnipresence in the dealscape news cycle when talks of making a bid for Warner Bros. Discovery hit the Wall Street Journal on Sept. 11, the day after Oracle founder-slash-dad Larry Ellison’s net worth jumped about a $100 billion.
My Ankler colleagues have this development well covered — Richard Rushfield has raised his concerns about the Warnermount pairing, and Sean McNulty looked at the potential implications of the deal in The Wakeup. So I’m sticking to my original plan for this week’s column, which is to look at the M&A landscape for everyone except the major studios and streamers.
I’m looking at what is deceptively labeled the mid market when, in terms of the potential for M&A that dealmakers are seeing now among companies from Neon to North Road, the opportunity is anything but mid. (Mid-market would include companies with annual revenues of $10 million to $500 million.)
“There’s talk about everyone merging,” says Chris Spicer, head of Akin’s media, entertainment and sports practice. “There is such an appetite to scale.”
Alphonse Lordo, who leads Content Partners Capital, the year-old private credit division of the stalwart entertainment investment firm Content Partners — which has acquired a portfolio of more than 600 films and 3,000 hours of television since its 2005 launch — says the middle market has enormous potential regardless of what happens with the big studios and streamers.
“Whether Paramount buys another studio, I don't think that changes much,” says Lordo. “In fact, it probably opens up some lanes for capital coming into the independent market and new operators to [come in].”
Today I’m digging into what’s for sale, who’s buying and what a company can do to improve its position in this chaotic market with the help of Spicer, Lordo, Integrated Media’s Jonathan Miller, O’Melveny’s Lindsay Conner and a couple of other dealmakers who shared candid thoughts but didn’t want to be quoted.
In this issue for paid subscribers I’ll cover…
Where dealmakers see the future for Neon, Bleecker Street, Teddy Schwarzman’s Black Bear, Imagine Entertainment & more
Candle Media’s $4B spending spree — and other big deals that turned into cautionary tales
Three roads open to smaller production companies in the new landscape
Two things every company must show to prove stability (and value) to investors
How to gauge the true strength of an IP library — and when it’s smarter to buy assets vs. whole companies
Why Hollywood’s mid-market has been left underexploited — until now
How indie studios are diversifying their businesses to boost value
Who’s circling TV and film acquisitions
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