Lionsgate to Explore Starz Spin-Off or Sale

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Lionsgate is looking into its options regarding the pay-TV channel Starz, which could be either a spin-off into its own company or an outright sale.

The company said Thursday in a filing related to the studio’s quarterly earnings stated in a filing on Thursday that its board of directors had authorized management “to explore potential capital markets alternatives for its Media Networks business (STARZ) including, but not limited to, a full or partial spin-off, split-off, issuance of a tracking stock or other transactions.”

Starz has 30 million global subscribers, with 18 million of them via the StarzPlay streaming service.

During their earnings call with analysts, Lionsgate vice chairman Michael Burns said that “while we continue to realize substantial synergies of bringing Lionsgate and Starz together” they are beginning to wonder if separating the two would be better for investors so they can value them independently.

Additionally, MGM’s $8.45 billion sale to Amazon was a factor. “Recent transaction multiples [in the entertainment sector] give us confidence that exploring alternate paths is prudent,” Burns said.

Lionsgate acquired Starz in 2017 for $4.4 billion. Starz currently has series including its “Power” franchise, the wrestling drama “Heels” and a TV adaptation of the movie “Blindspotting.” Upcoming, Starz will premiere “The Continental,” a TV series set in the world of “John Wick.”