On Tuesday, the Vice Chairman of Lions Gate Entertainment announced to investors an updated timeline for splitting its Lionsgate film studio and Starz cable television network to become separate companies. Lions Gate’s senior executives have long maintained that investors have undervalued the company because of its mixed portfolio of businesses. According to Vice Chairman Michael Burns, the divestiture will take place by September 2023.
Lions Gate’s market value has fallen by more than 50% over the past year, dragged down by the unimpressive status of the Starz network among cable channels. Last May, Roku was reported to be pursuing a buyout of Starz, with funds from private equity investor Apollo Global Management. The delay in this deal resulted from complications introduced by Roku and Apollo also exploring an acquisition of the Lionsgate film studio at the same time.
Meanwhile, Lions Gate is experimenting with creative approaches to boost its share price and increase interest among retail investors. The company has lost over 50% of its market cap in the past 12 months, like many other media and entertainment companies.
Investors with at least 100 shares of Lions Gate stock become members of the company’s ‘Shareholder Red Carpet Rewards program, which includes discounted movie tickets through a partnership with Atom Tickets, and limited-edition collectibles (NFTs) featuring popular characters from the company’s film and television properties. This appears to be an effort to re-create the magic that came together for AMC Theatres to rocket its share price during the depths of the pandemic.
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