Activist investor Anson Funds Management has acquired a stake in Lionsgate Studios (LION.US) and is in talks with the movie studio about unlocking value.
Anson Funds Management portfolio manager Sagar Gupta said Lionsgate Studios is undervalued and should consider a range of options, including a sale after the completion of the spinoff of its Starz cable and streaming service. Sagar Gupta added that Lionsgate Studios, with its strong potential revenue and deep content library, would be an acquisition target for traditional and digital media companies as well as major technology and artificial intelligence companies.
Anson Funds Management is one of Lionsgate Studios' top five independent shareholders. Anson Funds Management has had constructive talks with Lionsgate Studios' management and board. The company believes the studio's stock price is below peers such as Disney (DIS.US) and Warner Music (WMG.US) due to corporate governance issues and recent box office underperformance.
Sagar Gupta said Anson Funds Management supports Lionsgate Studios' Starz cable spinoff and believes the company should seek other revenue sources, such as further involvement in merchandise sales and Broadway productions, among others. Anson Funds Management also wants Lionsgate Studios to improve its financial disclosure. A Lionsgate Studios spokesperson said, "We always welcome shareholder ideas and opinions."