Investment will fuel expansion of Tiger Gate service

Lionsgate and Saban Capital Group aim to pounce on the fast-growing Asian TV market.

Saban Capital has joined Lionsgate as a 50-50 partner in the fledgling Tiger Gate pay TV service that Lionsgate launched with international TV vet William Pfeiffer and Lionsgate Intl. exec Paul Presburger in 2008. Hong Kong-based Tiger Gate created two themed channels, Thrill and Kix, in Indonesia last year and will expand both to the Hong Kong and Singapore markets later this month.

The plan unveiled Monday is for the partners to aggressively roll out the channels across Asia. They hope to expand to Thailand, Vietnam, the Philippines, Malaysia and Brunei within the next year and have their eye on the biggest targets of China, India, Taiwan, Japan, Korea and the Middle East. Tiger Gate may also acquire media properties in the Asian region.

Thrill features a mix of Asian and Western horror and thriller fare, including Lionsgate’s enduring “Saw” franchise. Kix serves up action-oriented programming, much of it derived from licensed TV shows from the region, ranging from stunt-driven reality shows to Japanese anime, as well as material from the Lionsgate vault. Tiger Gate will also look to acquire locally produced material that fits the Thrill and Kix brands, and down the road may dive into its own original production.

The business ties on Tiger Gate raise the question of whether deep-pocketed Saban Capital might be in a position to help Lionsgate fend off the hostile takeover attempt by financier Carl Icahn, who has been highly critical of management decisions by Lionsgate’s top brass. For now, insiders say Saban Capital is strictly focused on Tiger Gate but is open to the idea of doing more business together down the road.

Saban Capital had been scouting for a means to enter the Asian TV market. The partnership with a distrib that already has plenty of its own content was a no-brainer for Haim Saban’s investment firm. Deal with Lionsgate has been in the works for about a month. And at a time when Lionsgate management’s track record is under fire, the Saban deal is a tacit vote of confidence in the path pursued by Lionsgate co-chairman and CEO Jon Feltheimer and his team.

“Tiger Gate is off to a strong start, and we are confident that, with the addition of Lionsgate’s content and marketing and our operational experience and financial strength, this venture will achieve sustainable, long-term success,” said Adam Chesnoff, Saban Capital’s prexy and chief operating officer.

Asia is considered a ripe territory for pay TV because the markets in many countries, like Indonesia are just starting to take off, and distribs with strong content can easily get in on the ground floor with linear channels. Such shelf space is much harder to come by in the U.S. and Europe.

Saban Capital not only brings funding for the venture but also connections and operating expertise that will help Tiger Gate as it pushes an ambitious expansion plan.

“They have relationships around the world that will be useful for us in expanding the business,” said Pfeiffer, who is CEO of Tiger Gate.

Lionsgate emphasized that beefing up Tiger Gate is part of a broader global strategy to mine its library assets with themed channels and services. In the U.S., Lionsgate has the FearNet horror VOD channel in partnership with Comcast Corp. and Sony. Last year it bought cabler TV Guide Network in partnership with JP Morgan’s One Equity Partners.

“This is content that fits right in our sweet spot in the fastest-growing region” for subscription TV services, Feltheimer told Daily Variety .

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