Complex transaction expected to be complete by Monday
Liberty Media has officially draped the “for sale” sign on Starz, which will split from its parent this week and start trading on the Nasdaq with its own stock on Monday.Anyone can buy the stock or the company. Liberty chief John Malone thinks it may do better with a deep-pocketed Hollywood parent than under Liberty’s umbrella. “I think everyone can use a big brother,” he has said of the Starz spinoff. Starz is a big name worth an estimated $3 billion. But media companies have become highly selective about large deals, and a few potential buyers appear to have taken themselves out of the running. Comcast’s Universal just extended an output deal with HBO; News Corp. struck a similar deal with the Time Warner network last year. Neither conglom owns a pay-TV outlet, and these long-term pacts suggest they’re in no hurry to pick one up. Netflix, which in December outbid Starz for Disney films starting in late 2016, is rumored to be a potential suitor, but it’s not clear what Starz would bring to the streaming service, which seems to have no trouble acquiring either content or subscribers. At a Television Critics Assn. appearance in Pasadena over the weekend, Starz chief Chris Albrecht said that the company “could be part of either a bigger or a smaller media company,” and that the spinoff comes at “the right time for Liberty and for Starz.” He also underlined that Starz chose not to renew its pricey Disney deal. Starz still has Disney films until the pact expires in late 2016, as well as pics from Sony and from indie players including the Weinstein Co. Last year, TWC acquired 25% of home entertainment division Starz Media. Starz has been ramping up its originals. “Spartacus: War of the Damned,” premiering Jan. 25, will wrap up that series. “Da Vinci’s Demons” premieres in April. Albrecht said he’d like to make six to seven shows a year, some with lower price points than either of those. In an announcement Tuesday, Denver-based Liberty said it will distribute shares of a new company between Thursday and Friday. That company, which will briefly be called Spinco, will include all of Liberty’s assets except Starz. In a transaction sure to confuse most observers, the old Liberty Media, the piece left with Starz, will then be renamed Starz, while Liberty Spinco will become the new Liberty Media Corp. Liberty chairman John Malone’s financial alchemy can be hard to follow and is often designed to control tax repercussions of a deal. He uses tracking stocks, splits and spinoffs to tinker with an empire that is constantly in flux. Among its other assets, Liberty is in the process of taking over Sirius Satellite Radio and may have plans for Live Nation. Starz’s two classes of stock will trade under the symbols STRZA and STRZB. Liberty will resume use of its old symbols LMCA and LMCB. Shareholders as of Jan. 11 are eligible to receive shares of the new company.
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