Entertainment One on rise after Spielberg deal

Spielberg has raised $800m (£537m) of fresh equity and debt from former eBay executive Jeff Skoll and India’s Reliance Entertainment

Entertainment One rights to distribute DreamWorks films such as Bridge of Spies to cinemas, on-demand suppliers such as Amazon and through DVDs is being extended from the UK and Benelux into Australia, New Zealand and Spain (AP)

Shares in Entertainment One continued to claw back the losses they suffered earlier this month, gaining 3 per cent as the film and TV rights owner signed a wider and bigger distribution deal with Steven Spielberg’s fourth incarnation of DreamWorks, Amblin Partners.

Spielberg has raised $800m (£537m) of fresh equity and debt from former eBay executive Jeff Skoll and India’s Reliance Entertainment, run by Anil Ambani. Amblin Partners is named after the original Spielberg production company behind ET and Jurassic Park.

Entertainment One has taken a “small equity stake” in Amblin but would not say how big or how much it cost. In return, its rights to distribute DreamWorks films such as Bridge of Spies to cinemas, on-demand suppliers such as Amazon and through DVDs is being extended from the UK and Benelux into Australia, New Zealand and Spain. The new deal also adds licensing and merchandising of DreamWorks films, and distribution of Amblin’s TV productions.

Mr Skoll is the largest backer of Amblin, having put up around $200m, and JP Morgan has arranged $500m of debt financing to fund between four and seven films a year. A further $100m of equity came from Reliance, Spielberg himself and Entertainment One.

Current films in production at Amblin include The BFG, The Light Between Oceans, A Dog’s Purpose and The Girl on the Train.

Darren Throop, the chief executive of Entertainment One, said: “We are delighted to join Steven Spielberg, Jeff Skoll and Reliance in launching this unique new venture.

“As part of eOne’s stated growth strategy – to double the size of the business by 2020 – we continually strive to partner with producers of the highest-quality content, and Amblin Partners represents the gold standard. This long-term partnership builds on the successful output relationship between eOne and DreamWorks, whilst extending the relationship through additional territories, licensing and merchandising and television production and distribution.”

However, the broker Peel Hunt left its forecasts for the company unchanged and said: “Overall, [it’s] a small positive item today after a torrid few weeks of adverse trading.”

Entertainment One shares rose 5.4p to 176.1p on the news but are still well down on their 2015 peak of 328p. They fell sharply this month after a refinancing that pushed up interest costs.