Shares of Lions Gate Entertainment Corp. shot higher in after-hours trading Thursday after the entertainment company said it is weighing whether to spin off or sell its Starz unit.
“While we continue to realize substantial synergies from bringing Lionsgate and Starz together, we also see the opportunity to potentially unlock significant shareholder value under a scenario where investors have the ability to value our studio assets and Starz separately,” Lions Gate Vice Chairman Michael Burns said on the company’s earnings call. “Recent transaction multiples in the media space give us confidence that exploring alternate paths is prudent.
The premium cable channel has its own streaming service, with about 18 million streaming subscribers worldwide — about half as many as rivals such as Apple AAPL, -0.35% TV+, Comcast’s CMCSA, -0.42% Peacock and ViacomCBS’s VIAC, -4.39% Paramount+. Starz, which features prestige series such as “Blindspotting,” “Outlander” and “P-Valley” as well as recent movies, could be an attractive target for streaming services with money to spend and looking to bulk up their library, such as Amazon Prime Video or Apple TV+.
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