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LGF.A / LGF.B - Lions Gate Entertainment


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This is probably one of my most meager topic starts, please don't blame me. Lions Gate is a film studio / entertainment distributor. I just have some circumstantial evidence to present.


1. Mark Rachesky (an Icahn protege and activist) and Liberty Global are in a standstill agreement with LGF regarding their position that ends November, 10, 2020. (link).

2. A bunch of LGF shares owned by liberty were under a loan-and-collar agreement with Bank of America. September, 4 Liberty instructed BAC to unwind the position, releasing their pledge of 1.66m shares, even though half of there shares were to be released from October, 23 through November, 30 anyway. (link).

3. The CEO just entered in a new employment agreement, expiring August 21, 2023. Even though his original agreement expired May, 22 2023. Main difference: he received 2m stock appreciation rights with an exercise price of $8.17, vesting when the CEO gets booted due to a change of control, as far as I correctly understand the agreement.

4. A board member with a history of shrewd transactions aggressively buys 150k shares in three transactions, at prices ranging from $7.56 to $8.47 a week later (*). He has a history in investment management and is the co-chair of the strategic advisory committee.


Also interesting is that the vice-chairman, Michael Burns, who worked with the CEO since 2000 (link) did not get a new employment agreement. Burns is also on the board of Hasbro, who where very close to buying Lions Gate a few years ago (link).


I think something is brewing here, but I don't know what exactly and given that I don't know anything about this company I'm probably going to pass on it. So I figured I might as well open a topic in case somebody is more familiar with the company than I am. Judging by the share price things haven't been going well lately ..


(*) He buys in November 2019 at $9, a month later the stock is at $10.  He buys in December 2018 at $14, a month later the stock is at $17, etc. You get the picture. Seems like an opportunistic buyer, even though he is a long-term bagholder.

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Definitely smells like something going on. I haven't looked at in detail for a few years, but repeatedly has been speculated as a potential sale for many years - whether it's Starz or the library. As every streaming player looks to build their library, it could be an attractive asset. The question that comes up repeatedly is what is the value of older content versus newer content.

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