Roku and Apollo Global Management have put in a bid for a minority stake in the Lionsgate-owned cable and streaming service Starz.
Apollo and Roku are understood to be among multiple undisclosed bidders at this time, a source confirms to The Hollywood Reporter. The joint bid between Roku and the private equity firm was first reported by The Wall Street Journal.
Lionsgate has long been expected to explore a sale or spinoff of Starz, which it acquired for $4.4 billion in 2016. In November 2021, the board authorized the Lionsgate management team to begin looking into a “full or partial spin-off” of Starz, among other options, according to a regulatory filing from the time.
Related Stories
In a February 2022 earnings call, Lionsgate vice chairman Michael Burns did not comment directly on next steps for Starz but spoke to “unlocking the shareholder value.”
“We are working with a terrific team of advisers with complementary strengths and expertise as we continue the process of unlocking the shareholder value in our two core businesses. So it’s important to note that we will be providing additional updates on our progress at the appropriate time,” Burns said at the time.
Lionsgate declined to comment on the matter Tuesday.
Roku, meanwhile, has been making a greater push into original programming for its Roku Channel and recently inked a film output deal with Lionsgate. Starz is known for shows such as Outlander and the Power franchise.
The global streaming subscriber base for Starz, and Starzplay Arabia, has been growing in a time when other platforms have been concerned about stalling numbers. In March, Abu Dhabi-based firm ADQ and pay-TV operator E-Vision agreed to buy a majority stake in Starzplay Arabia.
In the three months ended Dec. 31, 2021, Starz and Starzplay Arabia reported 19.7 million global streaming subscribers, marking a 44 percent increase year-over-year. Revenue, however, had been impacted by a COVID-19 production delays and a soft first quarter.
Spinning off the premium cable and streaming service would provide cash to Lionsgate and allow it to explore more opportunities as a traditional television and film studio.
