Legendary Entertainment, the independent Hollywood studio backing “Jurassic World,” is in talks to borrow as much as $700 million to make films in a financing led by JPMorgan Chase & Co. and Bank of America Corp., according to people involved in the discussions.
The studio, led by film producer Thomas Tull, started out seeking to replace an almost $600 million credit facility led by the same two banks that matures in 2016, said the people, who asked not to be named because the negotiations are private. The amount may increase to $700 million because of strong demand, the people said.
Legendary, which raised $250 million in equity from Softbank Corp. in October, once worked with Warner Bros. on hits such as “The Dark Knight.” Tull broke away in 2013 and has expanded in television while making big bets on his own films, including “Pacific Rim” and “Godzilla.” The studio will release “Jurassic World,” a new sequel to the 1993 Steven Spielberg film, with its current distribution partner, Comcast Corp.’s Universal Pictures, in June.
Legendary is taking advantage of growing interest in the entertainment industry from investors seeking yield in a low-rate environment for loans. Many banks retreated from the market after the credit crisis several years ago.
The Los Angeles-based studio’s two releases so far this year, “Seventh Son” and “Blackhat,” disappointed at the box office. “Straight Outta Compton” lands in theaters in August.
Last year Legendary backed hits including Paramount Pictures’ “Interstellar,” which generated almost $675 million at the global box office. “Godzilla,” released by Warner Bros., rang up $528 million in ticket sales. A sequel is scheduled for 2018.
Melissa Zukerman, an outside spokeswoman for Legendary Entertainment, declined to comment, as did spokespeople from JPMorgan and Bank of America.
Tokyo-based Softbank, led by founder Masayoshi Son, can increase its investment in stages to as much as $1 billion by 2018. The deal last year valued Legendary at more than $3 billion, people familiar with the matter said then.
The agreement gives Softbank films and TV shows for networks it controls, and the companies formed a venture to develop online and mobile services in India and China.