EXCLUSIVE: Lionsgate is finalizing a deal to acquire a minority stake in London- and Los Angeles-based management and production company 42, we can reveal.
Management-production powerhouse 3 Arts Entertainment, of which Lionsgate is a majority owner, has been a key driver in concocting the deal and will look to collaborate on TV and film projects with the fast-growing 42 and Lionsgate in a three-way venture. We understand the pact will also include a first-look deal between Lionsgate Television and 42 for the US
Lionsgate and 42 were unavailable for comment but we know the pact is almost done. We hear it is lucrative and well into eight figures. In 2018, Lionsgate bought a majority stake in 3 Arts which valued it at $300 million-plus, so given the sky-high valuations of media companies right now in Hollywood, it’s likely to be a fair chunk of change.
Among 42’s hundreds of clients are Jesse Armstrong, Julian Fellowes, Claire Denis, Charlie Brooker, Michael Caine, Sofia Boutella, Nicholas Hoult, Krysty Wilson Cairns, Joanna Hogg, Lynne Ramsay, Nadine Labaki, Neil Marshall, Sebastian Lelio, Ed Skrein, Katherine Waterston, Jonny Lee Miller and Will Davies. Managers and partners include Josh Varney, Kate Buckley and Cathy King.
Production at the company is led by partners Ben Pugh and Rory Aitken. Movies have included Benedict Cumberbatch starrer The Courier and Netflix pics Outside the Wire and Night Teeth. TV has included HBO’s The Girl BeforeJulian Fellowes’ The English Game and the starry re-do of Watership Down. Upcoming with Netflix is the movie End of the Road and the series Flat Share with Paramount Plus.
The investment in 42 helps move Lionsgate TV closer to international talent and projects at a time when domestic studios and agencies are scouring the globe for international expansion opportunities and synergies with talent who travel like never before. The added scale and portfolio diversity doesn’t hurt should Lionsgate itself come on the block. Lionsgate had recently been kicking the tires on distributor STX.
42 gets to increase its US footprint and potentially scale up and 3 Arts gets a window into the international space. We hear that 42’s LA-based team — including producer Pugh (The Courier) and manager Varney — will move to take a floor in the 3 Arts building in Beverly Hills.
The growing 42, which has a headcount of more than 35, has been in-demand for a while. The company was set up a decade ago and has been making waves as a management and production company in the UK, but also via its LA presence.
Lionsgate’s majority investment in 3 Arts has already led to partnerships on series including MythicQuest for Apple+, and the upcoming series Manhunting for Apple+, Julia for HBO Max and The Serpent Queen for Starz. Lionsgate TV is coming off a strong 12 months in terms of 13 new TV pickups, its best ever, and the partnership with 3 Arts has helped drive that.
The investment in 3 Arts launched Lionsgate’ talent strategy. The deal with 42 is seen as an extension to that, using the same template to bring another likeminded management/production company into the fold.