Business|LeBron James’s SpringHill sells a minority stake to a group led by RedBird.
LeBron James and his longtime business partner Maverick Carter want to become major players in the film, television, gaming, consumer products, audio and live-events businesses (among others). On Thursday, four investors — RedBird Capital, Fenway Sports Group, Nike and Epic Games — agreed to “pour gasoline” on those ambitions.
That was how Mr. Carter, speaking by phone, described the sale of a “significant” minority stake in SpringHill, the company that he and Mr. James founded last year. The deal values SpringHill, where Mr. Carter is chief executive and Mr. James chairman, at about $725 million.
“This allows us to really double and triple down on financing our own content,” Mr. Carter said, noting that doing so would allow SpringHill to both build a library of content and more tightly control the creative process.
He declined to say how much cash was pumped into the company. SpringHill, which is based in Los Angeles, has 141 employees and will generate roughly $100 million in revenue over the next year, Mr. Carter said.
SpringHill’s operations include a marketing consultancy (clients have included General Motors, Sprite and JPMorgan Chase) and a media and apparel division focused on athlete empowerment. Another division, SpringHill Entertainment, produces film and television shows. (An expired partnership with Warner Bros. resulted in the big-budget movie sequel “Space Jam: A New Legacy” over the summer. Additional scripted projects are gestating at Universal Pictures and ABC, which is owned by the Walt Disney Company.)
Sale chatter began to swirl around SpringHill this year as a wide variety of companies and investors — hoping to capitalize on the streaming boom — looked for media start-ups to buy. Reese Witherspoon, for instance, sold her Hello Sunshine to a special purpose acquisition company, or SPAC, backed by the Blackstone Group.
Mr. Carter and Mr. James turned away other suitors before deciding to make a deal with the investor group led by RedBird, which was founded in 2014 by Gerry Cardinale, a former Goldman Sachs executive who is known for building businesses. A prime example was his 2001 creation of the YES regional sports network, which broadcasts New York Yankees games, with the Steinbrenner family. RedBird, which manages about $5 billion in capital, is also an investor in David Ellison’s Skydance Media.
Mr. Cardinale said he was especially taken with SpringHill’s emphasis on empowerment.
“Sports has a very important role to play in addressing societal issues,” he said in a phone interview. “Maverick and LeBron have an unbelievable opportunity to take a real leadership position in pushing that forward.”