Stake in `Spider-Man,' Sony Films Is Said to Fetch $280 Million

(Bloomberg) -- Sony Corp.’s former film-financing partner sold its stakes in movies including “Spider-Man: Homecoming” to an investment group led by ex-Dresdner Kleinwort bankers, according to people familiar with the matter.

Vine Alternative Investments Group agreed to pay about $280 million to acquire the stakes from LStar Capital, a financing arm of Dallas-based Lone Star Funds, said two of the people, who asked not to be identified discussing private information. Vine declined to comment.

LStar ended its financing deal with Sony Pictures Entertainment last year, refusing to fund the poorly reviewed “Emoji Movie” after investing in a string of commercial flops, including “Aloha” and “The Brothers Grimsby.”

With the sale, brokered by Salem Partners, Lone Star joins a group of investors that have pulled back from the rough-and-tumble world of Hollywood film finance. Competition from digital distributors like Netflix Inc. has hurt attendance at theaters, and slate-financing funds like LStar’s have been less successful because there have been fewer hits. In 2017, movie attendance in the U.S. and Canada fell to a 25-year low.

While the films Vine is buying a piece of have already come out, they still generate revenue from home video and other distribution agreements and sometimes carry rights for sequels.

Vine, set up in 2006, focuses on investments in the media and entertainment sector. It has more than $700 million committed to investments backed by films, television and other media, according to its website. The firm, led by Chief Executive Officer James P. Moore and Chief Investment Officer William E. Lambert, has acquired stakes in major film financiers such as Village Roadshow, which backed more than 100 films from studios including Warner Bros. with titles such as “The Lego Ninjago Movie” and “Mad Max: Fury Road.”

Sony and LStar struck their $200 million deal in 2014 to fund years’ worth of films, and had extended it to 2019. But the fund backed out of the arrangement that would have involved them investing another $50 million in movies such as “Peter Rabbit.”

Sony has improved its performance since LStar bowed out. Even though “The Emoji Movie” was savaged by critics, it went on to make $217 million worldwide off a budget of $50 million, according to Box Office Mojo. “Jumanji: Welcome To The Jungle” has led the North American box office for three straight weekends, giving Sony its longest winning streak for a single film since 2001. The LStar deal didn’t include “Jumanji.”

To contact the reporter on this story: Anousha Sakoui in Los Angeles at asakoui@bloomberg.net.

To contact the editor responsible for this story: Crayton Harrison at tharrison5@bloomberg.net.

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