Hony Capital, TPG Growth co-lead $700m funding in STX Entertainment

Photo from STX Entertainment's Facebook page.

Chinese private equity firm Hony Capital and TPG Growth, the growth capital investment arm of US-based private equity giant TPG, have co-led a $700 million investment in US media firm STX Entertainment.

The funding raised by the five-year-old Burbank film studio, founded by Robert Simonds, is a combination of equity and debt refinancing, STX chief financial officer Andrew Warren was quoted as saying by The Latimes.

The additional capital, which includes more than $100 million in equity, will help STX release more movies, grow its TV business and pursue acquisitions. The media and entertainment company is considering deals to purchase assets including film libraries and international television production companies. The company plans to release 15 movies this fiscal year, compared with about 10 in 2018.

The new financing round is a boost for the small studio that makes and releases movies with budgets between $20 million and $80 million. The company was co-founded by TPG Growth Bill McGlashan, who has been put on indefinite leave by the private equity firm after reports surfaced of his involvement in a US college admissions scandal this week.

Other STX Entertainment investors include Southeast Asian internet and cable service provider PCCW, Tencent Holdings, Liberty Global, East West Bank chairman Dominic Ng and DNS Capital.

Last year, the studio had filed for an initial public offering (IPO) in Hong Kong to raise around $500 million, which would have valued the company at more than $2 billion. The plan was shelved months after filing its prospectus because of turbulence in the stock market.

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