As part of the proposal, Lions Gate will exchange 3.43% of its common stock for 4.51% of stock in Starz owned by Malone. The movie studio will gain 14.5% of the total voting power of Starz common stock. After the deal is done, Malone will join the LGF Board of Directors.
“Lionsgate has emerged as a leader in developing global content, and this transaction creates the potential for a number of strategic opportunities around the world with them,” Malone said in a statement. “I’m delighted to add my voice to the board of directors of one of the most exciting content companies in the industry.”
Earnings estimates have been positive for LGF as of late (see: Why Earnings Season Could Be Great For Lions Gate (LGF)), and the company’s shares saw a sharp increase Wednesday, gaining 8.15% to sit at $32.11. The stock jumped to over a 1-month high and re-crossed both its 50 and 200 day moving averages.
LGF sits at a Zacks Rank #3 (Hold) and is in the bottom 39% in Zacks Industry Rank.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
LIONS GATE ETMT (LGF): Free Stock Analysis Report
STARZ-LIB CAP-A (STRZA): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research