Lionsgate Taking First Steps Toward STARZ Spinoff in April; What Could Separation Mean For Studio’s Licensing Deals?
Lionsgate currently has distribution deals in place with The Roku Channel and Peacock, but will they survive the studio’s split from one company into two?
The long-promised split of the Lionsgate movie studio from the STARZ cable/streaming bundle is getting underway in April. A new report from Deadline indicates that the studio will merge with a special purpose acquisition company (SPAC) in April, and will begin trading on the Nasdaq under a different symbol than STARZ.
- The plan is for Lionsgate to be fully split from STARZ by the end of 2024.
- Once the split is complete, STARZ and its properties like “Outlander” and the “Power” franchise would be available for acquisition.
- The transactions should not have an effect on licensing deals between Lionsgate and streaming partners like Peacock and The Roku Channel.
Lionsgate filed paperwork seeking approval to split into two separate entities, titled “New Lionsgate” and “New Starz” in July of 2023. In December of last year, Lionsgate announced that its TV and movie studios would be merged with a SPAC named Screaming Eagle Acquisition Corp. to create a new entity called Lionsgate Studios Corp.
As reported by Deadline, that process is now expected to be underway by April. Lionsgate Studios Corp will retain control of STARZ, which will be fully separated from Lionsgate by the end of 2024 if everything goes according to the company’s plans. Speaking at the 2024 Morgan Stanley Technology, Media and Telecom conference this week, Lionsgate vice chairman Michael Burns said he thought the separation had the potential to lead to long-term growth for the studio and for STARZ.
“Ultimately, I don’t have a crystal ball, but I do believe that there are very interesting opportunities with STARZ in the consolidation of independent channels,” Burns said. “And Lionsgate, with the library and TV and film business, will be a very interesting strategic alliance partner — that is euphemistically put — with other players.”
What Will Happen to Lionsgate, STARZ Content After Split?
It’s not immediately clear what will happen to STARZ originals like “Outlander,” the “Power” franchise, “BMF” and “P-Valley” once it’s split from Lionsgate. From the sound of things, Lionsgate will control most of the intellectual property (IP) in the TV and film libraries of the company, but if it pulls those franchises from STARZ there will seemingly be little left for the cable channel/streamer to offer.
Lionsgate movies could have a new streaming home once they leave theaters, however. Currently, Lionsgate movies are put on Starz after their theatrical runs, after which they go to The Roku Channel for an exclusive streaming window. Once the movies depart from The Roku Channel, they head to NBCUniversal’s streaming service Peacock. Those deals were first struck in 2022 and run for multiple years, and there has been no announcement from any company involved thus far that Lionsgate’s plans will change the terms of the agreements. Things could always change as the divestment process unfolds, but as of now, The Streamable expects these windowing deals to remain in place.
Considering Lionsgate is reportedly planning a TV series based in the “John Wick” universe, as well as an animated “Twilight” show, the company clearly has some attractive IP to license. Recent analysis has shown that Disney has the most attractive catalog in terms of licensing, but it’s a good bet that other media companies will approach Lionsgate about possible licensing deals considering the top franchises in its arsenal. Lionsgate acquired the studio eOne in 2023, giving it the rights to Hasbro properties like Transformers and more.
There could be several new streaming partners for titles that originate from Lionsgate this year, as the studio takes more steps to separate itself from STARZ. That process will take another big step forward in April and is expected to be finished by the end of 2024.
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.”