Lionsgate Prepares to Spin Off Studio, Film and TV Library For Possible Sale, Keeping Starz
After months of not knowing whether Lionsgate would spin off its studio or the Starz cable/streaming bundle, we now have a bit more clarity.
After months of speculation and analysis, there is finally some movement on the Lionsgate front. In July, the company filed paperwork to create two separate business entities; one for its movie and TV studio, and the other for its cable/streaming bundle Starz. Now, reports indicate that Lionsgate has made its decision, which will see its TV and movie studio spun off and merged with a special-purpose acquisition company (SPAC).
- Lionsgate will merge with Screaming Eagle Acquisition Corp to form Lionsgate Studios Corp.
- Its main goal will be to raise cash and make itself a more attractive acquisition target for a bigger company.
- Lionsgate Studios Corp. has an 18,000-title library, including “The Hunger Games” and “John Wick.”
Lionsgate Out, Starz In?
Lionsgate is spinning its movie and TV studios off to be merged with an SPAC named Screaming Eagle Acquisition Corp. Once the merger is completed in the spring, the new entity will be called Lionsgate Studios Corp., a global pure-play, publicly traded company which will attempt to raise new capital and make for an intriguing merger and acquisition target.
Lionsgate Studios Corp. will bring with it an 18,000-title library of films and movies. The deal will see Lionsgate remain as the majority shareholder, as it will control 87.3% of available shares while Screaming Eagle will control 12.7% of the new company. The Starz bundle will continue to be controlled by Lionsgate itself and is not included in the deal.
“This transaction creates one of the world’s largest independent pure play content platforms with the ability to deliver significant incremental value to all of our stakeholders,” Lionsgate CEO Jon Feltheimer and vice chair Michael Burns said in a statement. “Coupled with the acquisition of the eOne platform scheduled to close next week, the expansion of our partnership with 3 Arts and the strong performance of our content slates, we’ve put together all of the pieces for a thriving standalone content company with a strong financial growth trajectory.”
What Will Happen to Starz Now?
If you’re an “Outlander” fan who’s worried that this means the next season of the show may be canceled, have no fear. While it’s not clear if the Lionsgate film and TV library now being spun off will include all titles currently on Starz, there should be no slowdown in the production of content by Lionsgate or Starz in the short term.
That could change in the long term, however, depending on who eventually acquires the new Lionsgate Studios Corp. If that company does get to hold the rights to all content on Starz, it could decide to reimagine the entire content slate at the channel/streamer, or simply shut it down and migrate its content elsewhere.
It’s a good bet that the new arrangement with Screaming Eagle is intended to include content acquired from Lionsgate’s recent move to merge with eOne, which granted it the rights to Hasbro properties like the “Transformers” franchise and others. Those added rights will make Lionsgate Studios Corp. all the more attractive to a potential buyer, and it would be surprising not to see them included in the new company’s assets.
While Lionsgate’s future is not completely decided by this update, it is an important step that answers a long-asked question of what the company intended to do with itself. Now there is an answer: the Lionsgate TV and movie studio will be spun off and merged, while Starz will be kept in-house by the parent company.
STARZ
STARZ offers a subscription video streaming service that gives access to content on the STARZ channel without the need of a cable subscription. With your subscription, you’ll get access to 7,500+ films and episodes, including all of their current originals like “Outlander,” The Serpent Queen,” “BMF,” and “Power.”