BlackRock Inc.'s HPS and Brookfield Corp.'s Oaktree Capital Management have seized control of MBS Group, a company that supplies lighting, rigging, and other essential services for Hollywood productions. This takeover involved wiping out as much as $900 million of MBS Group's debt, reflecting the struggles faced by the global entertainment industry amid changing economic conditions.
The firms executed the deal by converting the substantial debt into approximately $100 million of equity in MBS Group. In addition to this debt-to-equity conversion, BlackRock and Oaktree have committed to investing an extra $40 million into MBS Group, which currently provides production services to over 600 entertainment locations globally.
This transaction effectively removes the previous owners, Hackman Capital Partners and Affinius Capital, from MBS Group's capital structure. Hackman Capital and Affinius had acquired MBS Group in 2019 from Carlyle for $650 million. The recent deal underscores the financial challenges within the entertainment sector, leading creditors to assume ownership of key service providers.
