Canuck film, TV co. to ask investors for $30 mil
MONTREAL — Canuck film and TV company Lions Gate Entertainment is set to hit up stock investors in the Great White North for $30 million to help finance its ambitious expansion plans.
The Vancouver-based company has filed a preliminary prospectus with the securities commissions in the Canadian provinces of Ontario, Manitoba, Alberta and British Columbia to qualify for the equity sale. The company will be selling “units” that consist of convertible preferred shares of stock and common share purchase warrants that allow unit holders to buy shares of Lions Gate at specified prices.
Yorkton Securities will act as the company’s agent for the issue, which is expected to be priced next week.
In spite of the recent announcement of encouraging financial results, Lions Gate’s shares continue to perform sluggishly on the Toronto stock exchange. The shares were up slightly by the end of trading Wednesday to C$3.60 ($2.42) following the news of the upcoming share-issue, but the company’s shares are still well below the year’s high of $4.04.
The $30 million offering will be used for general corporate purposes, including expanding the company’s film and television business.
“Our objective is to continue to grow the business and (that) I think is extremely positive news,” Lions Gate president Roman Doroniuk said.
The shares will not be offered for sale in the U.S.
Lions Gate recently set up a $13 million credit facility with the National Bank of Canada, which Doroniuk said the company is going to use to beef up its U.S. film distribution business. Lions Gate Films recently released its highest-profile pic in the U.S. so far, Kevin Smith’s controversial comedy “Dogma.”