Legendary Entertainment is making an ambitious strategic move by buying out Dalian Wanda Group’s stake in the company.

Legendary CEO Josh Grode described the deal as a "right place, right time" situation. “Wanda was looking for some liquidity in its investments, and after a strong start to 2023, we had significant excess liquidity,” Grode explains. “After about six months of discussions, we reached terms that worked for both sides, and the transaction turned out to be very beneficial for both management and Apollo, which will own the business nearly equally after the deal.”

While the exact terms of the deal were not disclosed, the company confirmed that the buyout was financed using cash from its balance sheet, with Legendary retaining substantial liquidity for future business operations and expansion plans.

Wanda initially acquired Legendary in 2016 for $3.5 billion, but in 2022, private equity firm Apollo acquired a $760 million minority stake, buying out part of Wanda’s ownership.

“We’re excited to deepen our partnership with Legendary and continue supporting Josh, Mary [Parent], and the talented team,” said Apollo partners Aaron Sobel and Lee Solomon. “We see Legendary as an exceptional platform for growth, well-positioned to succeed as the entertainment industry evolves.”

Following the buyout, Legendary’s board will be split evenly between management and Apollo executives. Grode praised the deal, stating, “This was very accretive for everyone, and we believe we bought it at a great price.”

The buyout comes after a highly successful year for Legendary, with Dune: Part Two and Godzilla X Kong: The New Empire collectively earning nearly $1.3 billion at the global box office. Upcoming projects include video game adaptations of Minecraft and Street Fighter, as well as new films from Denis Villeneuve and Alejandro G. Iñárritu, starring Tom Cruise.

Grode attributes the company’s success to its collective effort: “Success doesn’t come from one place; it’s the result of everyone working together toward a common goal,” he says, acknowledging the contributions of Legendary’s creative team, led by Mary Parent, and its partners at Warner Bros.

With the buyout of Wanda, Grode notes that while the company’s creative control remains unchanged, it now has more flexibility to pursue major mergers and acquisitions. “Before, foreign ownership issues might complicate discussions around large-scale M&A, but that’s no longer a concern,” he says.

Founded in 2000 by Thomas Tull, Legendary has built its reputation on working with established intellectual properties and major studios. Moving forward, with its management team in control and support from Apollo, the company plans to continue its film and TV strategy while exploring new growth opportunities. Legendary also secured an $800 million credit facility with JPMorgan last year.

“We’re now in a position with significant ownership and excess liquidity,” Grode says. “We have the opportunity to create great content in film and TV, and expand through both organic growth and M&A.”