HPS and Oaktree take control of Hollywood supplier MBS Group after default

Creditors will convert hundreds of millions of dollars of debt into equity, and they plan to inject a further $40m to stabilise MBS and fund a return to growth. Bloomberg reported that the restructuring wiped out as much as $900m of debt, which lenders turned into roughly $100m of new equity.

MBS Group services more than 600 sound stages across the globe, among them New York’s Silvercup Studios and Los Angeles’ Television City. However, the company struggled under its debt load as large entertainment groups cut production budgets, a squeeze that has weighed on the film and television sector since the streaming bubble burst in 2022. Spending on scripted television is down by a fifth from its 2022 peak, according to ProdPro, which tracks industry activity. Even the rebound in films entering production during 2025 was driven largely by lower-budget independent projects.

The company’s former owners, Hackman Capital Partners and Affinius Capital, exited as part of the transaction. The pair had bought MBS from Carlyle in 2019 for $650m, when low interest rates and a content boom encouraged aggressive expansion across prized filming locations.

More recently, MBS was also caught up in Hackman Capital’s own financial pressures, which prompted recapitalisation talks last August. The business, advised alongside Hackman by restructuring specialist AlixPartners, additionally faced conflicts over how it was paid for services across Hackman’s wider property portfolio. About 14% of the stages MBS services are owned by Hackman.

A spokesperson for MBS said the company had “achieved commercial growth” and was “gaining market share across the world”. Hackman Capital did not immediately respond to the FT’s request for comment.

HPS, which BlackRock acquired in 2025, ranks among the largest private credit managers in the world. Oaktree, the specialist distressed investor that Brookfield took full ownership of in July, built its franchise on precisely this kind of situation.

Both are now adjusting to an environment where capital moves more slowly. Fitch Ratings warned last week that private credit default rates had reached a record 6% in the year to the end of July, the highest level since the agency began tracking the metric.