Starz CEO Chris Albrecht Addresses Merger Speculation
A Starz merger with Lionsgate has been an on-again, off-again possibility for years.
Starz CEO Chris Albrecht thinks Lionsgate will merge with another company, though not necessarily with Starz, and when that happens, it could set off a domino effect of more mergers and acquisitions.
"They made their filing a day before their crummy earnings call," Albrecht said, referring to a regulatory filing in February disclosing Lionsgate was interested in merging with Starz. The disclosure didn't help the stock, though, as Lionsgate shares plunged 30 percent.
"They're a terrific company," Albrecht added, speaking Thursday at the Gabelli 8th Annual Movie & Entertainment Conference in New York.
"There will be something that will happen," he said, speaking of mergers in the entertainment space, "whether it's with Viacom or Time Warner, or whether it's with Starz or Lionsgate or AMC. I think once something happens, there are going to be more things that happen."
He added: "I really believe there's value creation there. Some CEO is going to have to be willing to take their money and go home ... there's only one CEO of a company, which is often one of the problems of putting some of these companies together. I, on the other hand, am very easy. You want me to stay, pay me. You want me to go home, pay me."
A Starz merger with Lionsgate has been an on-again, off-again possibility for years, especially given John Malone — or "young Dr. Malone," as Albrecht called him Thursday — is a major investor in both companies.
Like Albrecht, analysts have been predicting consolidation in the industry under the assumption that companies will need more scale to deal with challenges like cord cutting and skinny bundles. Recent acquisitions include Comcast's NBCUniversal agreeing to buy DreamWorks Animation and Rovi buying TiVo.
"I don't predict any particular occurrence, but I do predict that we will see more activity in the M&A space among the companies I mentioned and more, and young Dr. Malone will be somewhere, you can be sure," said Albrecht.