Lionsgate believes that content and distribution are intertwined and so have announced their deal to buy cable pay provider Starz for $4.4 billion. According to Multichannel, " Although anticipated for months, the combination will give Starz the production heft it has craved as well as a vast content library – the merged entity will have 16,000 movie and TV titles – while Lionsgate gets a distribution arm in the Starz and Encore premium channels. It also paves the way for a broad range of new content partnerships and accelerates the growth of Lionsgate and Starz’s own OTT services." A win-win for both companies and one that leverages the strengths of each other. The deal should be approved by end of year.
This deal comes as a result of the work done by John Malone, CEO of Liberty Media , who invested in Starz, spun it off into a separate company and ultimately put Lionsgate together with Starz to finalize a deal. Not surprising, Malone's Discovery Channel also has a piece of Lionsgate making this deal more of a family affair for Liberty Media. Given John Malone's MIdas Touch with content and distribution, the newly combined entity will do quite well.