Starz CEO Addresses Deal Chatter, Expects "Stand-alone Company for Foreseeable Future"
Chris Albrecht at a New York industry conference also discussed a recent deal with Curtis "50 Cent" Jackson.
Starz CEO Chris Albrecht at an industry conference on Thursday said he had no deal to disclose as he addressed recurring chatter about a possible combination of the premium TV company with Lionsgate or AMC Networks by highlighting the "complexities" of any such combinations.
Speaking at the FBR Digital Media Thought Leaders Day at The Paley Center in New York in a session that was webcast, he also said: "I go to work every day thinking Starz is going to be a stand-alone company for the foreseeable future." He had made that same comment earlier in the year when asked about a possible merger or sale.
On Thursday, when confronted with that scenario, he said: "There honestly isn't anything to report or we'd report it. And ... it would be weird if I wasn't talking to these guys" at Lionsgate and AMC.
After all, Lionsgate is now a shareholder of Starz, and "we're talking about some potential investments" on shows that the companies may do together along with other ideas, he said.
Similarly, AMC Networks and Starz have a relationship as the latter distributes "the hard goods for all of their originals, so there is always stuff to talk about between the companies." Added Albrecht: "It would be foolish if we weren't discussing whether there are things that we might do together that could benefit both companies."
He added about any potential full-on merger or sale: "Putting those things together takes an interest, takes a good strategy ... then you have to try to make a deal ... so there are a lot of complexities to this stuff." He added: "It has to be a good idea," but so far "nobody has been convinced where anybody has gotten to the point even of the level of the rumors," Albrecht said.
He later added: "Scale for scale’s sake doesn’t make sense … If you put together two good companies that are executing well on a strategy, you are going probably to create more opportunities than you are going to create obstacles … The opportunity to scale up in a really focused, disciplined, strategic way is probably a good thing if you can accomplish it."
Ever since big Starz shareholder John Malone early this year swapped some of his Starz stock for a stake in Lionsgate, Wall Street observers have been discussing the companies' future relationship and a possible bid by AMC Networks for Starz.
Is there real value in combining what Malone has called "free radicals" in the content industry, or smaller standalone companies? Albrecht said if combinations are "complementary," they can work. They also allow for increased financial muscle and strategic benefits in a world where content is becoming more important, such as "the ability to be a magnet for that content."
Lionsgate is "at a point, like Starz, where it is time to think about what’s next," Albrecht had said in February, adding the two would have "a lot of potential conversations" beyond partnering on shows like in the past. He later teased a "kissing cousins"-type relationship.
Albrecht has this year been repeatedly asked about whether an outright merger could make sense. "It certainly remains to be seen," the Starz CEO said at one point earlier this year. "There have to be really good reasons" for outright combinations.
Asked on Thursday about a recent deal Starz struck with "50 Cent" Curtis Jackson, Albrecht called him a "great partner," "a great promoter," a good actor and "a social media force." He quipped that he has only had three FaceTime calls in his life, and they were all with Jackson, who was always sitting in the back of a car.