Legendary Entertainment sells $760 million stake to Apollo

(Reuters) -Apollo private equity fund will invest $760 million in Legendary Entertainment, the production and finance company behind films “Dune,” “Godzilla vs. Kong” and television series “Lost in Space” and “Carnival Row,” both groups said on Monday.

The studio, which China’s Dalian Wanda Group acquired in 2016 in a deal valued at $3.5 billion, has been quietly exploring its options for some time, as Wanda sought to reduce its ownership position, people familiar with the matter said.

Legendary had held preliminary talks with special purpose acquisition companies as it weighed the possibility of going public, the sources added.

The investment is one of a number of recent deals in Hollywood in which backers are betting on voracious demand for content as streaming services vie for subscribers.

Legendary Chief Executive Joshua Grode told Reuters he was seeking an investment partner who shared the view about the “secular tailwinds” fueling demand for content and would support future acquisitions to grow the media company.

“(Apollo) really saw the world the same way we saw it,” said Grode.

Apollo will acquire a minority stake through its investment, both companies said.

Apollo said it was attracted by the studio’s track record in creating popular content, and its relationships with the top studios and streaming services alike.

Apollo partners Aaron Sobel and Lee Solomon will join the Legendary board of directors.

Wanda will remain the majority holder of Legendary, although Apollo and management will hold significant stakes.

Reporting by Dawn Chmielewski; editing by Kenneth Li, Nick Zieminski and Richard Pullin