Hasbro, Inc. (NasdaqGS:HAS) entered into a definitive agreement to acquire Entertainment One Ltd. (LSE:ETO) from The Capital Group Companies, Inc. and others for £2.8 billion on August 22, 2019. Under the terms of the transaction, Entertainment One shareholders will receive £5.6 in cash for each common share of Entertainment One. Hasbro expects to finance the transaction with the proceeds of debt financing and approximately $1 billion (£816.7 million) to $1.25 billion (£1 billion) in cash from equity financing.

Hasbro has entered into a debt commitment letter with Bank of America Merrill Lynch to provide a 364-day senior unsecured bridge loan facility in an aggregate principal amount of up to £3.6 billion, to secure funding of the purchase price. Hasbro, Inc. will not use cash on hand to ensure liquidity in the business. Hasbro entered into a $1 billion (£816.7 million ) term loan agreement with Bank of America, N.A., as administrative agent, and certain financial institutions, as lenders, the proceeds of which will be used to pay a portion of the consideration. The funding under the term loan agreement consists of a three-year senior unsecured term loan facility in an aggregate principal amount of $400 million (£326.7 million) and a five-year senior unsecured term loan facility in an aggregate principal amount of $600 million (£490 million). To fund the acquisition, Hasbro will use $321 million (£262.2 million) of cash on hand and proceeds from Hedging Arrangements. As of November 4, 2019, Hasbro entered into a $875 million (£714.6 million) of common stock offering to fund the acquisition. Upon termination of the agreement under specified circumstances, Entertainment One would be required to pay Hasbro a termination fee of approximately £29 million. On November 13, 2019, Hasbro, Inc, secured $2.38 billion (£1.8 billion) under unsecured notes offering to partly fund the transaction.

Top Entertainment One executives have agreed to join the Hasbro team. The transaction is structured as a statutory plan of arrangement under the Canada Business Corporations Act and is subject to receipt of certain regulatory approvals, including pursuant to the Investment Canada Act, the Competition Act (Canada), the expiration or termination of the waiting period under the Hart-Scott-Rodino Act, as amended, and certain other governmental consents, approval by shareholders of Entertainment One and the Ontario Superior Court of Justice, dissent rights not having been exercised with respect to more than 10% of Entertainment One's outstanding common shares and other customary closing conditions. Entertainment One is subject to customary non-solicitation provisions under the definitive agreement and a termination fee payable to Hasbro in certain circumstances. The deal has been approved by the Boards of Directors of each of Hasbro and Entertainment One. The Board of Directors of Entertainment One, after consultation with its financial advisors as to the financial terms of the transaction and its legal advisors, unanimously determined that the transaction is in the best interests of Entertainment One and has recommended that Entertainment One shareholders vote in favor of the transaction. As of October 9, 2019, Federal Trade commission granted the early termination notice. Certain of the Directors and officers of Entertainment One entered into voting and support agreement pursuant to which they have to vote 1.5% stake held by them in Entertainment One, in favor of the acquisition. As of October 17, 2019, shareholders of Entertainment One voted to approve the proposed merger. Transaction also received antitrust approval in Germany. As of October 21, 2019, the Ontario Superior Court of Justice (Commercial List) approved the transaction. As of November 21, 2019, UK's Competition and Markets Authority announced that it is investigating the transaction and would examine whether the transaction would hurt competition and is inviting interested parties to comment on it until December 5. The transaction is expected to close during the fourth quarter of 2019. As of November 4, 2019, the transaction is expected to close late in the fourth quarter of 2019 or early in the first quarter of 2020. As of November 21, 2019, the transaction is expected to close during the first quarter of 2020. As of December 30, 2019, the transaction is expected to close on December 30, 2019. The addition of Entertainment One to Hasbro is expected to be accretive to adjusted EPS in the first year following the transaction, adjusted to exclude one-time transaction costs and purchased intangible amortization, with mid- to high-teens accretion to adjusted EPS in the third full year following the closing of the transaction as synergies are achieved.

J.P. Morgan Cazenove acted as a fairness opinion provider for Entertainment One's Board of Directors. J.P. Morgan Cazenove acted as financial advisor and Emmanuel Pressman, Alex Gorka, Rosalind Hunter, Peter Glossop, Kaeleigh Kuzma, Firoz Ahmed, Drew Morier, Richard Borins and Kelly Moffatt of Osler, Hoskin & Harcourt LLP and Rob Hamill, Rebecca Bothamley, Kate Ball-Dodd, Andrew Stanger, Julian Ellison and Adam Wolk of Mayer Brown International LLP acted as legal advisors for Entertainment One. Centerview Partners LLC acted as financial advisor and Faiza J. Saeed, Allison M. Wein, Stephen L. Gordon, Andrew W. Needham, Michael S. Goldman, Craig F. Arcella, Christine A. Varney, Margaret Segall D'Amico, Jesse M. Weiss, Eric W. Hilfers, David J. Kappos, Joyce Law, Brian M. Budnick and Laurel R. Berkowitz of Cravath, Swaine & Moore LLP, John Ciardullo of Stikeman Elliott LLP and Laurie McFadden, David Aitman, Thomas Janssens and Mena Kaplan of Freshfields Bruckhaus Deringer LLP acted as legal advisors for Hasbro.

Hasbro, Inc. (NasdaqGS:HAS) completed the acquisition of Entertainment One Ltd. (LSE:ETO) from The Capital Group Companies, Inc. and others on December 30, 2019. Upon the closing of the acquisition, Hasbro borrowed the full amount of the term loan facilities. The proceeds of the term loan facilities were used by Hasbro to pay a portion of the Consideration and other amounts payable in connection with the acquisition. Darren Throop, President and Chief Executive Officer of Entertainment One, will report to Brian Goldner, Hasbro Chairman and Chief Executive Officer. In addition, Entertainment One's Olivier Dumont, President, Family & Brands, Steve Bertram, President, Film & Television, and Chris Taylor, Global President, music, will also be joining Hasbro, reporting to Throop. The Competition and Markets Authority (CMA) cleared the transaction on January 16, 2020. As of January 16, 2020, the transaction has received the anti-trust approval from Canadian authorities and the parties waived the condition regarding the approval by the CMA. Matthew Thompson of Sidley Austin LLP acted as legal advisor to Entertainment One.