A consortium of investors led by Najafi Companies has closed its deal to purchase STX Entertainment, the beleaguered film and television company behind “Bad Moms” and “My Spy.” The sale ends STX’s unhappy union with Eros, the Indian media company that it merged with in 2020. The goal was to go public, which STXEros did, but to little investor fanfare. STX had previously tried and abandoned an effort to go public on the Hong Kong stock exchange in 2018, citing unfavorable market conditions.
The cash-strapped independent studio had attracted some 11th hour interest from Lionsgate, but a potential deal collapsed, leaving Najafi Companies, a Phoenix-based private-equity firm run by Jahm Najafi, as the victor. Najafi is the vice chairman of the Phoenix Suns. Investment firms AS Birch Grove LP and 777 Partners helped finance the deal for STX. In December the group bid $173 million for the company.
STX said its executive team will remain in place, with Robert Simonds continuing as its chairman. Noah Fogelson, currently the company’s president, will become the new CEO, while Adam Fogelson will keep serving as chairman of the motion picture group.
STX was formed in 2014 with the goal of making the kinds of mid-budget comedies, thrillers and dramas that major studios had largely abandoned in favor of franchise fare and superhero flicks. But STX struggled to field enough hits. It made a few winners, such as “Hustlers,” but financial losers like “Free State of Jones,” “The Happytime Murders” and “Uglydolls” far outnumbered the hits. That left the company struggling under some $150 million in debt and in need of a deal to help get it some more liquidity. It appears to have found that in Najafi.
“At a time when the demand for global content has never been greater, we are very excited about this rare opportunity to acquire STX Entertainment, one of the only remaining independent studios. As investors, we are long-term minded, and we believe in the power of storytelling and fostering a studio that is friendly to storytellers,” said Najafi.