Why former Fox boss Peter Chernin has stayed independent: ‘Sanity.’

Former studio and TV network heads tend to return to the C-suites of major Hollywood movie-TV-streaming conglomerates sooner or later. Not Peter Chernin.

The film and television producer, known for ‘Ford vs. Ferrari’ and ‘New Girl’, was chairman and chief executive officer of Fox Group when the company greenlit ‘Titanic’ and ‘Avatar.’ But since leaving the studio in 2009 and founding his own company, the Chernin Group, he has remained independent.

Now, 71-year-old Chernin is forming a new company that will combine film and television assets under one holding company with $800 million in equity and debt funding as demand for entertainment content grows thanks to streaming.

The new Los Angeles-based company, dubbed North Road Co., bills itself as a “global, multi-genre content studio” poised to capitalize on the growing premium content market, with Chernin as Chairman and Chief Executive .

His bet is that in a world of growing viewership and fewer big studios, having a standalone provider of movies and TV shows will yield huge dividends.

Fox’s film and television studios were acquired by Walt Disney Co. in 2019. Disney and Warner Bros. studios have increasingly become funnels for their Disney+ and HBO Max streaming services. The consolidation and rise of increasingly vertically integrated media giants has left a huge void.

“I think the world needs a big, trustworthy, well-funded independent,” Chernin said. . “Now that there’s this explosion of content and more appetite for content, the truth of the matter is that the number of providers has actually shrunk. And that is a real opportunity.”

North Road will consist of Chernin Entertainment, the screenplay TV and film business the mogul founded in 2010; the US operations of Red Arrow Studios, which North Road acquired in June; and 100% ownership of Words + Pictures, an unwritten content company that Chernin founded with partners last year.

Providence Equity Partners, a longtime supporter of Chernin, is investing up to $500 million in equity to support the company’s expansion. Apollo Advisors, part of private equity giant Apollo Global Management, has provided $300 million in debt financing through affiliates.

Part of the company’s mission will be to increase its international productions as non-US markets become more important drivers of streaming viewership.

The corporate transformation of Chernin’s empire follows a spate of sales and private equity investments involving branded production companies as the TV and film production business surged amid the streaming wars.

Reese Witherspoon’s Hello Sunshine has been sold to Candle Media, backed by Blackstone, in a $900 million deal. LeBron James and Maverick Carter’s SpringHill Co. has been valued at $725 million after selling a minority stake to RedBird Capital. Hipster-friendly indie studio A24 raised a minority stake that valued the New York-based company at $2.5 billion. Legendary Entertainment raised $760 million from Apollo funds.

The rush of deals followed Amazon’s announcement in May 2021 that it would buy MGM for around $8.5 billion.

Chernin said he began thinking about the next phase of his company last fall amid the deal frenzy. But he wasn’t interested in trying to sell, he said.

“I think if I had sold out in the fall I would have sold cheap,” he said. “I wasn’t interested in just cashing out and trying to make a quick buck. I’m obviously commercially oriented, but I think this is a much better commercial piece. We will make a lot more money in the long run.”

Though he has his own company, Chernin has frequently been the subject of speculation that the latest major studio opening would return him to Hollywood’s musical chair game.

Tom Rothman and Jim Gianopulos, who ran Fox’s film operations together for more than a decade, later ran the film group of Sony Pictures and Paramount Pictures, respectively (Gianopulos was relieved at Paramount last year). Michael De Luca, who has held key positions at New Line, Dreamworks and Sony, has transitioned between producing and running the studio, most recently serving as co-chairman at Warner Bros. Pictures with Pamela Abdy.

But Chernin has managed to thrive as a producer, getting him into a club with former studio heads like Sony alum Amy Pascal. With producer Jenno Topping, Chernin’s Operation is responsible for hits like the Oscar-nominated Hidden Figures and Ford v Ferrari (the latter won two statuettes) as well as the recent Planet of the Apes trilogy. On television, Chernin’s sitcom “New Girl” ran for seven seasons on the Fox network.

In both scripted television and film, Chernin has delved deep into the streaming market, signing a first-look deal in 2020 to make Netflix films despite a track record at the box office. Chernin said his company remains “completely platform agnostic” and believes in the theatrical market.

Streaming projects have included horror triptych Fear Street on Netflix and Jason Momoa’s sci-fi series See on Apple TV. Chernin’s upcoming projects include a Netflix film based on the Idris Elba series Luther and an animated series for the streamer inspired by the card game Exploding Kittens.

Red Arrow’s US assets, which were acquired by European media company ProSiebenSat.1, include popular reality shows such as Netflix’s Love is Blind, Lifetime’s Married at First Sight and Say Yes to the Dress TLC.

When asked why he’s stayed away from high-profile studio and network jobs, he jokingly answered with one word: “sanity.”

“To be blunt, I think I had the best job in entertainment when I had it,” he said. “If I wanted to continue running one of these companies, I would have stayed at Fox. … I wanted a new challenge. I’ve been doing it for 13 years. Why would I go back and do it again? That just looks silly.”

https://www.latimes.com/entertainment-arts/business/story/2022-07-06/why-former-fox-boss-peter-chernin-has-stayed-independent-sanity Why former Fox boss Peter Chernin has stayed independent: ‘Sanity.’

Sarah Ridley

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