The shareholders of Lions Gate Entertainment have approved the merger agreement with Trimark Pictures.
Trimark’s board is scheduled to meet Oct. 12 to vote on the deal’s approval. If it OKs the pact, as expected, the deal will close the following day. A Lions Gate executive said the company would likely announce downsizing plans after the merger’s completion.
Lions Gate plans a scaling-down of its presence in both Gotham and Toronto. A Lions Gate exec would not comment on whether Toronto-based Lions Gate Films prexy Jeff Sackman planned to remain with the company.
One of the most significant conditions necessary to close the merger was Lions Gate’s securing of a minimum $100 million credit facility. The company doubled that mark with the closing and funding of a $200 million credit facility backed by a syndicate of global financial institutions led by Chase Securities, Dresdner Kleinwort Benson and National Bank of Canada.
If the Lions Gate and Trimark merger closes as expected, the latter will cease to exist as a corporation. The name will live on, however, in the form of Trimark Video. Other Lions Gate video labels include Avalanche, Sterling Home Video, Eaton and Lions Gate Home Entertainment.
“Our growth momentum has been accelerated by the rapid funding of this credit facility,” said Lions Gate CEO Jon Feltheimer. “This financing substantially increases the capital available to continue our financial and strategic growth initiatives, expand our filmed entertainment production and distribution capabilities and opportunistically identify selective new acquisitions in the future.”
Cashing in on rep
“The funding of the credit facility reflects the global financial market’s support for Lions Gate’s new strategic direction and its confidence that Lions Gate can fill an important competitive niche in the world entertainment marketplace,” said John Miller, managing director of Chase Securities’ Entertainment Industries Group.
Lions chief financial officer Marni Wieshofer added, “The blue-chip quality of our investors and lenders, ranging from our preferred equity financing last December to the closure of the current credit facility, is an important vote of confidence in our business plan.”