Lionsgate has signaled strong support for its micro-budget feature division with longtime production exec John Sacchi tapped to head the operation.

The studio is aiming to replicate the success of Paramount Insurge, formed in the wake of the outsize success of producer Jason Blum’s “Paramormal Activity.” Insurge’s “The Devil Inside” grossed more than $100 million worldwide last year at a cost of only $1 million.

Sacchi has a long track record in supervising Lionsgate films with exec producer credits on “My Bloody Valentine,” “Punisher: War Zone” and “The Possession,” which grossed nearly $80 million last year. He oversaw the studio’s Arnold Schwarzenegger actioner “The Last Stand,” which opens Friday.

The micro-budget arm is understood to be seeking horror and comedy projects with a pricetag of up to $2.5 million.

Lionsgate has long specialized in low-budget genre fare such as the “Saw” franchise, produced by Twisted Pictures. The original “Saw” cost $1.2 million and led to six sequels that generated nearly $800 million in worldwide grosses.

Lionsgate had already been developing micro-budget projects in recent years. It shed the “minimajor” label during 2012 thanks to its purchase of Summit and a stellar box office performance highlighted by “The Hunger Games” and the final “Twilight” film. Lionsgate execs see considerable promise in another young-adult franchise “Divergent,” set for release in March 2014.