Lionsgate Stresses Benefits of MGM Combination

SANTA MONICA/VANCOUVER: Lionsgate’s senior executives have issued a statement noting that the proposed combination with MGM is a "natural fit" for the studio.

Earlier this week, the independent studio proposed a merger with debt-laden MGM, in a plan that would see the combined company owned by shareholders of Lionsgate and creditors of MGM.

"This is a unique, once in a lifetime opportunity to create a dynamic, forward-looking studio that unlocks tremendous potential value for Lionsgate’s shareholders and MGM’s various stakeholders," said Jon Feltheimer, co-chairman and CEO, and Michael Burns, vice chairman. "A Lionsgate merger with MGM is a natural fit that would bring together two of the most powerful libraries in the world, create significant cost savings, consolidate our mutual global channel operations and generate significant incremental revenue and cash flow. It would create a combined entity with enough scale to leverage all of our distribution platforms worldwide."

Lionsgate said it believes that its three largest shareholders, Carl Icahn, MHR Fund Management and Capital Research Global Investors, support the merger proposal.