M&A
January 6, 2022
5 minutes read

Russo Brothers Sell $400M Stake In Film Company To Japanese Gamesmaker Nexon

Joe and Anthony Russo “Russo brothers,” the famous movie directors and producers who have produced big-grossing movies including Avengers: Endgame…

Joe and Anthony Russo “Russo brothers,” the famous movie directors and producers who have produced big-grossing movies including Avengers: Endgame and Captain America: Civil War, have a good reason to celebrate at the start of this new year. They’ve sold a $400mn minority stake in AGBO, their film production company, to Nexon, a Japanese game developer, as part of a tie-up between both companies.

The Japanese game studio invested via Nexon Film & Television, its newly launched film and television division headed by entertainment veteran Nick van Dyk, who has taken a board seat at AGBO. Nexon paid $400mn for a 38% stake in AGBO, valuing the film company founded by the Russo brothers in 2016 at $1.1bn. Nexon also committed to invest up to $100mn more if the Russo brothers request it within this year’s first half.

The Russo brothers founded AGBO in 2016 as the corporate umbrella for their big-budget, top-tier movie deals. They hired film producer Mike Larocca as President and secured their first overall TV deal in 2018. Since then, AGBO has secured more lucrative deals to produce content for major movie studios like Netflix and Amazon Studios. For example, the Russo brothers will direct a movie adaptation of The Gray Man for Netflix in what would be Netflix’s most expensive original film ($200mn budget). They already directed Extraction, Netflix’s third-most watched movie on record before that deal.

Nexon is a publicly-traded Japanese-South Korean video game publisher specializing in online games for PC and mobile. It has developed dozens of games, including popular ones like MapleStory, Sudden Attack, and FIFA Online. The investment is strategic to jumpstart Nexon’s foray into films with a well-versed partner. The signal is that Nexon wants to make successful movie adaptations of its games, and seeking the skills of movie experts like the Russo brothers will help with that.

Outside AGBO, the Russo brothers are best known for their work in the Marvel Cinematic Universe, producing films for the Avengers and Captain America franchises. They’ve made four Marvel films in total, including Avengers: Endgame, which was released in 2019 and grossed nearly $3bn at the box office, and Captain America: Civil War which debuted in 2016 and grossed over $1bn. Their Marvel films grossed around $7bn at the box office.

The Russo brothers began directing films in the late 1990s and have come a long way to having a production company valued at over a billion dollars. Their Nexon deal follows the trend of big production deals recently struck by producers making content for the big streaming services. For example, actress Reese Witherspoon recently sold a majority stake in her production company, Hello Sunshine, at a $900mn valuation. Also, Hollywood power couple Will & Jada Smith recently sold a stake in theirs at a $600mn valuation to the same firm that bought Witherspoon’s.

“As we look to extend the reach of our storytelling, Nexon’s best-in-class games capabilities, pioneering work in creating online Virtual Worlds, and global footprint make them an ideal strategic partner.” Jason Bergsman, AGBO’s CEO, said in a press statement.