Cast & Crew Entertainment Services LLC, which provides
payroll and other services to the entertainment industry, has a new
private-equity backer.
Silver Lake is buying the Burbank, Calif., company in a deal
that values Cast & Crew at $700 million including debt, people
familiar with the matter said.
Beyond handling payroll and health insurance for clients, the
company processes rights to future income streams, known as
residuals, handles workers' compensation and labor relations
issues, and provides advice around tax credits.
Its earnings are growing at roughly 15% annually, one of the
people said.
The investment from Silver Lake will allow Cast & Crew to
support its clients "in a rapidly evolving entertainment
landscape," said Eric Belcher, Cast & Crew chief executive.
Companies like Netflix Inc. and Amazon.com Inc. have increased
their production of online content, which may drive growth for
companies like Cast & Crew.
The people said Cast & Crew's growth opportunities include
expanding its employment insurance and live events units, adding
new offices as clients increasingly shoot offshore, and developing
its expense management software.
Silver Lake, a Menlo Park, Calif., firm that focuses on
technology-enabled investments, is buying Cast & Crew from a
consortium led by New York private-equity firm ZM Capital LP, which
in turn bought a controlling stake in the services provider in
December 2012 from another buyout firm, ABRY Partners LLC. Cast
& Crew's management will retain a small stake in the company,
the people said.
The deal comes as private-equity firms continue to sell
companies at a faster clip than they have previously in part due to
robust demand from corporate buyers, fueled by inexpensive debt, as
well as demand from other private-equity firms, which have raised
record sums.
Silver Lake's other investments in the entertainment industry
include William Morris Endeavor Entertainment LLC, which bought IMG
Worldwide Inc. in May 2014.
Write to Gillian Tan at gillian.tan@wsj.com
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