Lions Gate to Explore Starz

Lions Gate Entertainment Co. said Thursday that it has rekindled merger talks with Starz, a year after cable mogul John Malone set the table for a tie up.

In a regulatory filing, Lions Gate—Hollywood's largest independent studio and maker of shows including AMC's "Mad Men" and the "Hunger Games" film franchise—said it "intends to explore whether there is a potential mutually beneficial combination of the two companies."

Last November, Mr. Malone exchanged a portion of his Starz stake for a 3.43% position in Lions Gate and a seat on the studio's board. Through the swap, Lions Gate got a 4.51% stake in Englewood, Colo.-based Starz. Mr. Malone is Starz's largest voting shareholder.

Starz, home of the Starz and Encore networks, was spun off from Mr. Malone's Liberty Media Corp. in 2012, one move in a string of restructurings that has transformed the cable conglomerate into several smaller but separate companies. Last May, Mr. Malone helped orchestrate a $55 billion merger between Charter Communications Inc. and Time Warner Cable Inc. Liberty helped fund the deal by buying $5 billion of new Charter shares.

A month later, Mr. Malone told The Wall Street Journal that Lions Gate could buy Starz "and potentially other free radicals in the industry." That was after Lions Gate had earlier expressed interest in pursuing a deal with Starz, but the two sides couldn't come to terms over valuation and tax issues.

Write to Lisa Beilfuss at lisa.beilfuss@wsj.com

(END) Dow Jones Newswires

February 04, 2016 07:45 ET (12:45 GMT)

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