Embarking on a cost-cutting strategy, Kevin Mayer and Tom Staggs’ Blackstone-backed company Candle Media is reorganizing its business by consolidating live action and animation under two separate units.

All of Candle’s animated projects will be folded into kids content powerhouse Moonbug Entertainment—a strong performer in the LA-based company’s portfolio, driven by popular IPs such as CoCoMelon and Blippi. According to Semafor, which broke the news about the reorg, Moonbug accounted for “the vast majority” of Candle’s profits last year.

And housing all of the live-action content businesses—including Reese Witherspoon’s Hello Sunshine and Exile Content Studio—is a new banner called Candle Studios, which Hello Sunshine chief Sarah Harden will run as CEO. It’s set up to share production facilities and business/legal affairs, and it’ll also have a coordinated sales and distribution process. “This will bring all of our live-action properties into one division, with each benefiting from a go-to-market strategy and shared resources, while retaining their unique brand identity, audience profiles and day-to-day creative and business leadership,” Mayer and Staggs explained in a joint statement.

Last December, Bloomberg reported that Candle Media was in debt to the tune of more than US$1 billion after it failed to reach profit targets in a market climate impacted by an overall spending pullback and Hollywood’s dual strikes. The price tags on Candle’s recent acquisitions have also been notably hefty—it bought Hello Sunshine for US$900 million in 2021, and reportedly spent US$3 billion on Moonbug later that same year.

In May, Hello Sunshine got a high-profile greenlight from Amazon Prime Video to produce Elle, a prequel series centering around the teenage years of Legally Blonde‘s titular character. And all told, Candle Studios will be in production on more than 30 premium originals this year.

Pictured: Kevin Mayer and Tom Staggs