STX Puts Gerard Butler ‘Greenland’ Sequel Into Bankruptcy Protection As It Looks To Firm Up Acquisition By The Najafi Companies

As STX looks to finalize its acquisition by the Najafi Companies, a deal that was announced in late 2021, it has put the sequel to Gerard Butler movie Greenland into bankruptcy protection.

The first Greenland grossed $52 million globally but did not have a U.S. theatrical run due to Covid. It wound up being sold to HBO Max in a lucrative deal, amid the first wave of release-model adjustments to the pandemic by the film business. STX then obtained rights to sequel Greenland: Migration for more than $75 million in a seismic transaction at the Cannes market last summer, that Deadline was the first to report.

A subsidiary of parent company ErosSTX called FSO Jones LLC, formally sought Chapter 11 protection from creditors on Monday in New Orleans. The move is designed to shield the next installment in a burgeoning franchise from any financial liabilities during the company’s ongoing transition to new ownership.

The $173 million STX acquisition, which was proposed last December, included a “go-shop period” during which the company could explore a preferable suitor. Given Najafi’s relative inexperience in the film and TV business, it wasn’t a surprise when Lionsgate surfaced in January as a potential buyer. Sources familiar with those talks, however, tell Deadline that STX is unlikely to wind up with Lionsgate in the end. (Investors have lately viewed Lionsgate as more of a seller than a buyer, given its decision last year to put premium cable and streaming outlet Starz on the block.)

Najafi, an Arizona-based investment firm run by Jahm Najafi, has stakes in the NBA’s Phoenix Suns, automaker McLaren, ticketing firm StubHub and an emerging beauty product line created by Scarlett Johansson.

In a statement provided to Deadline, STX said, “Although pre-production of this sequel is going well, we determined that it was necessary for FSO Jones to seek bankruptcy relief to protect the value of that entity for all of our stakeholders while we continue to work toward closing our strategic alternatives for this company.”

The sequel acquisition deal saw STX put up about $25 million for domestic rights in a split with European producer-seller Anton and CAA Media Finance. STX also took world rights from Anton, with foreign being valued at around $50 million.

Given the uncertain state of the company, Anton indicated it might try to cut ties with the project, sources tell Deadline. At this point, no other STX projects have seen any similar rumblings. STX has signaled to stakeholders that it intends to follow through on financing and distributing the sequel once the Najafi transaction is complete.

Bloomberg previously reported on the bankruptcy filing.