Like a dashing, 18th century Scottish lord courting his lady love, the marriage between Lionsgate and Starz has been in the works for quite some time. As Variety reports, the two companies have been dancing around a merger for more than a year. Now, Lionsgate has finalized a deal to acquire the premium cable network that airs original dramas like Outlander and Power, as well as comedies like Survivor’s Remorse for $4.4 billion in cash and stock.
Variety reports Lionsgate CEO Jon Feltheimer and vice chairman Michael Burns commenting on the acquisition, saying, “This transaction unites two companies with strong brands, complementary assets and leading positions within our industry.” Variety quotes Chris Albrecht, CEO of Stars, responding, “Jon, Michael and the rest of the Lionsgate team have built the first major new Hollywood studio in decades, and we’re thrilled to join with them in a transaction that multiplies the strengths of our respective businesses.”
Lionsgate has already been a powerhouse television studio. The company has produced high-profile dramas like Mad Men for AMC, Orange is the New Black for Netflix and the upcoming Dimension 404 for Hulu. However, acquiring a premium cable network like Starz gives Lionsgate a platform for their own content, so the brand can build and compete with premium big hitters like HBO and Netflix. As Variety reports, the acquisition brings Lionsgate a total of 11 Starz and Encore-branded premium channels, as well as the Starz online platform.
Starz as a network has built itself up as an ideal candidate for a deal like this in the past few years. Variety reports that the network has gotten its first momentum in original programming since its creation in 1994. It boasts popular drama Outlander, which is an adaptation of Diana Gabaldon’s poplar romantic fiction series featuring a woman from the 1940s travels back in time to 18th century Scotland. Entering its third season is Starz original Power, which is produced by 50 Cent, a crime drama that follows a New York City nightclub owner involved in a major drug network. Starz also has comedy Survivor’s Remorse, produced by NBA star LeBron James, which follows a fictional NBA player and his family after he signs his first NBA contract.
As Variety reports, Lionsgate will pay 18% more than the 20-day average value of Starz shares. Also, in a board meeting, in a Monday conference, Lionsgate told investors that the new combined Starz and Lionsgate will commit $1.8 billion per year to new film and TV content. We look forward to the new content from this combined force in television.