John Malone Completes Sale Of His Lionsgate Stake

By Patrick Hipes, Dade Hayes

John Malone
Andrew Gombert/Epa/REX/Shutterstock

John Malone has completed a selloff of his stake in Lionsgate, with the studio’s chairman Mark Rachesky agreeing to purchase 2,399,571 Class A voting shares from the media mogul and his personal affiliated entities for $22.05 million.

Malone previously sold off a total of 517,437 Class A voting shares between September 23-30, according to a Securities and Exchange Commission filing Thursday. It indicated Malone now “beneficially owns no shares of Class A Voting Shares” in the film and TV studio.

Rachesky via his MHR Fund Management Llc upped his stake to 22.1% with the deal, according to another SEC filing today.

Malone still has stakes in Lionsgate via both his Liberty Global and Discovery, the latter of which recently merged with Scripps Networks Interactive. Liberty also has a stake in STX Entertainment.

The movement comes at a delicate moment for Lionsgate shares, which closed Thursday at $9.06, up a fraction. In 2019, they have plunged to multi-year lows after starting the year above $16. In early 2018, they cracked $35 a share after the influx of revenue from movie hits like Wonder, La-La Land and John Wick: Chapter 2.

The downward trajectory has put the company’s fate under scrutiny. For 20-plus years, it has pursued a course of growth as an independent company, pulling off a series of acquisitions and managing not to be the acquired one. But the longer the stock price remains in the $8-$10 range — where it has hovered since August — the closer potential buyers will circle.

Malone had been a member of Lionsgate’s board of directors, exiting that post in fall 2018 after a little more than three years. He had joined in February 2015 after Lionsgate and Starz, in which Malone had a majority stake, sealed a stock-swap agreement. (Lionsgate ended up purchasing Starz for $4.4 billion in cash and stock in December 2016.)

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