Department M Secures Majority Stake in Indie Powerhouse Neon

Department M, the film and TV production company founded by Mike Larocca and Michael Schaefer, has closed a deal to acquire a majority stake in Neon, the Oscar- and Cannes-Palme d’Or-winning indie studio. Financial terms were not disclosed. The acquisition follows months of talks that began at the European Film Market in February and replaces an earlier, aborted sale to Indian Paintbrush founder Steven Rales.

Variety Magazine

Neon founder Tom Quinn will stay on as chief executive officer. Department M partner Michael Schaefer will assume the role of Neon’s chief content officer, overseeing both film and the newly announced Neon TV mini-studio. Department M partner Mike Larocca will not join Neon’s day-to-day operations but will take a seat on its board. Existing Neon executives Jeff Deutchman (president of acquisition, production and development) and Carina Sposato (executive vice president, television) will report to Schaefer. The Friedkin Group, led by Dan Friedkin, remains a significant shareholder and board member.

Deadline Hollywood

The capital infusion enables Neon to launch Neon TV, expanding its footprint beyond feature films into serialized content. Industry observers note buzz about a potential UK distribution arm modeled on Lionsgate. Both Neon and Department M already maintain separate partnerships with the Qatar Film Committee, which holds a slate deal with Neon and a biopic production pact with Department M. The deal also brings Department M’s development-ready projects into Neon’s pipeline, positioning the combined entity to leverage its award-winning library for broader market reach.

Deadline HollywoodVariety Magazine

Neon’s press release emphasized the continued involvement of the Friedkin Group and highlighted the addition of development assets from Department M. Department M’s announcement framed the transaction as a means to “contribute development assets and production-ready projects,” underscoring a collaborative growth strategy.

Variety Magazine

• “Mike Larocca and Michael Schaefer‘s Department M has closed a transaction to acquire a majority stake in multi Oscar- and Cannes Palme d’Or-winning studio Neon.” — Department M announcement

Deadline Hollywood

• “In a release touting the pact, Neon said The Friedkin Group, which has been a long-time backer, remains a significant shareholder and board member.” — Neon press release

Variety Magazine

• “Department M is already supplying development- and production-ready projects as part of the new deal.” — Department M statement

Deadline Hollywood

• “Both Neon and Department M already have separate partnerships with Qatar.” — Deadline report

Deadline Hollywood

• “The new deal will keep long-standing Neon backers The Friedkin Group as significant shareholders and board members.” — Department M statement

Deadline Hollywood