Almost three weeks after movie studio Lionsgate said in a Securities and Exchange Commission filing that it was starting talks with Starz about a possible merger, the premium network's CEO Chris Albrecht said he “believes in consolidation,” but that its recent stock price decline doesn’t reflect the true value of the company.
Lionsgate and Starz have been the focus of rumor speculation for years, especially after Liberty Media chairman John Malone – Starz’ largest individual shareholder – swapped a 3.4% stake in the premium channel for a 4.5% interest in Lionsgate.
On a conference call with analysts to discuss fourth quarter results, Albrecht said Starz is “open minded about the best ways to create shareholder and strategic value for ourselves and any possible business partners. However, we only believe in a potential combination that fully appreciates the value of our business and provides appropriate returns for our shareholders. While we believe the recent stock market volatility has left our stock meaningfully undervalued, the fundamentals of our business have not changed.”