Activist investor urges Lionsgate to consider a sale

An activist investor has taken the step Lion’s Gate shares and boosts leadership in several ways, including selling the Jon Feltheimer-led studio after it officially separated from Starz.

Anson Funds Management – an alternative asset manager led by chief investment officer Moez Kassam with an activism strategy from Sagar Gupta – has acquired a stake in the studio and is now one of the top shareholders of Lionsgate stock, a source confirmed. The Hollywood Reporter.

When asked for comment, a Lionsgate representative responded: “We always welcome the ideas and input of our shareholders.” The company declined to comment on how Anson approached Lionsgate brass or what proposals management might have submitted from the activist investor. Bloomberg first reported Anson’s move.

Lionsgate’s massive film and television library of 20,000 titles, home to franchises such as John Wick, Saw, The Hunger Games, Twilight, Now you see me And Rambo – has been floated around for years as a potential acquisition for a larger studio (or tech giant) looking to scale up in Hollywood.

Anson also sees the Lionsgate library, which generated $892 million in revenue over the past 12 months, as an asset to buyers. In September, the studio became the first of the majors to use ink an appointment with artificial intelligence company Runway to mine some of its library to train Gen AI models.

During its last earnings call, on Nov. 10, Feltheimer said the studio plans to grow its film offering “two to three tentpoles per year to create significant added value for our library, expanding our film and television packages to buyers and successfully capitalize on our greatest opportunities for outsized growth.”

The studio has also released a string of recent underperforming titles this year, including Borderlands ($32 million in worldwide box office receipts), The Crow ($23.5 million), 1992 ($2.9 million) and The killer game ($5.8 million).

In late December 2023, the company closed the deal to acquire producer Entertainment One, snapping up its 6,500-title library and picking up shows like Yellowjackets And The Rookie for its television division. It also owns the management and production company 3Arts Entertainment and operates a products and experiences division that organizes live shows based on its IP (such as the upcoming La La Land The musical or Twilight In Consultation).

Premium cable brand Starz is expected to formally split into a standalone company by the end of the year. According to its latest annual report, Lionsgate had 1,500 employees worldwide.