Lions Gate To Buy Starz For $4.4 Billion

As part of the merger agreement, each share of Lions Gate stock will be reclassified into 0.5 voting and 0.5 newly created non-voting shares. Starz shareholders will receive $18.00 in cash in addition to 0.6784 of a share of Lions Gate's new non-voting stock based on a fixed exchange ratio.

Related Link: Brexit Thwarts Starz's Attempts To Partner With Lions Gate

Lions Gate's offer implies a total consideration of $32.73 per share, representing an 18 percent premium to Starz's 20-day trading average.

Lions Gate noted the deal is expected to create synergies and increase content creation capabilities. The merger will also enhance Starz's leadership position in premium scripted programming and scale its global distribution footprint.

A joint Lions Gate-Starz entity will boast 16,000 television and TV titles and become the largest independent television business in the world with 87 original series on 42 U.S. networks. The combined entity can also claim to have a feature film business that has generated $7 billion in global box office sales over the past four years and operations or investments in 30 channel platforms across the world.

Management Weighs In

"This transaction unites two companies with strong brands, complementary assets and leading positions within our industry," said Lions Gate Chief Executive Officer Jon Feltheimer and Vice Chairman Michael Burns. "We expect the acquisition to be highly accretive, generate significant synergies and create a whole that is greater than the sum of its parts. Chris Albrecht and his team have built a world-class platform and programming leader, and we're proud to marshal our resources in a deal that accelerates our growth and diversification, generates exciting new strategic content opportunities and creates significant value for our shareholders."

"Jon, Michael and the rest of the Lions Gate 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," said Starz Chief Executive Officer Chris Albrecht. "Our similar entrepreneurial cultures and shared vision of the future will make this alliance an incredible fit that creates tremendous value for our shareholders, great content for our audiences and limitless opportunities for our newly-combined company. I am very appreciative of the work, passion and dedication of both of our companies' employees and more enthusiastic than ever about the future of our business."