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As stock in Lionsgate soared in morning trading on Friday, top execs at the mini-studio did little to discount speculation a major stake could be sold to Chinese e-commerce giant Alibaba.
Lionsgate vice-chairman Michael Burns declined to deny reports Mark Rachesky, whose 37.4 percent stake in Lionsgate in 2011 thwarted Carl Icahn in his proxy fight, is in negotiations over a possible sale to Alibaba chief Jack Ma. “We obviously can’t comment on speculation in the press about any of our shareholders, including our largest and very supportive Mark Rachesky,” Burns told analysts during a morning call after the release of Lionsgate’s second quarter results on Thursday.
But Lionsgate CEO Jon Feltheimer encouraged bets a new Asian strategic partner may purchase a stake in the mini-studio with his own remarks to analysts. “I just got back from Hong Kong and, at the end of the day, if there’s an equity component, it encourages people to do other strategic things with you,” he said in answer to a question about the value of having a major new equity investor on the ground in Asia as that market expands.
Feltheimer recently attended the annual Cable & Satellite Broadcasting Association of Asia convention in Hong Kong. He was commenting after media reports suggested Rachesky talked to Ma about acquiring his investment in Lionsgate as the company chairman possibly cashes out.
Lionsgate was one of Ma’s recent stops in Hollywood as he met with studios to acquire online content and possibly ownership stakes. The Vancouver-based mini-major earlier this year pacted with Alibaba to launch a streaming service in China to distribute titles like Divergent and The Twilight Saga: Eclipse and TV shows such as Mad Men, Weeds and The Royals.
Feltheimer on Friday opened the analyst call with upbeat remarks about his recent visit to Hong Kong. “I was struck by the incredible velocity of change in Asia, where the emergence of online video continues to create incredible opportunities for companies like ours to deliver our content to consumes in exciting ways,” he said.
Shares in Lionsgate rose $1.30, or by 3.7 percent, to $33.25 during mid-morning trading on the New York Stock Exchange.
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