Liberty Media Plans Starz Spinoff

ENGLEWOOD: Liberty Media is planning to spin off the premium pay-TV network Starz as its own independent company.

Starz will become a separately listed entity, with a debt of around $1.5 billion.

“The senior Starz team and I are very energized by the decision to make Starz its own independent company,” said Chris Albrecht, Starz’s CEO. “I believe this stand-alone structure is the first step to unlocking the real potential growth opportunities for our businesses. The Starz subscription businesses are continuing their run of quarterly subscription highs, with Starz achieving 20.7 million subscribers and Encore reaching 34.2 million at the end of the second quarter. We continue to add value to the networks with our investment in quality original programming, with our Golden Globe-winning series Boss returning to Starz for its second season later this month. Global anticipation is building for the fourth and final installment of Spartacus in January 2013. David Goyer’s new series, Da Vinci’s Demons, and the second season of Magic City will round out our programming slate for the first half of 2013.”

For Q2, Starz revenue was unchanged, at $403 million. An increase in the channels business was offset by decreases in revenue for the distribution and animation businesses.

At Liberty Media, revenue was relatively flat, at $537 million. Operating income increased 7 percent to $101 million.

“We are pleased to announce our plan to separate the assets of Liberty Media and Starz, LLC, creating two separate asset-backed stocks,” commented Greg Maffei, the president and CEO of Liberty. “This transaction will provide better transparency on the Starz operating business; optimize the Starz capital structure; permit us to better pursue our strategic objectives, including creating two currencies that could be used for acquisitions; and create significant liquidity at Liberty Media, which preserves all our options with respect to SiriusXM and Live Nation.

“Starz again posted impressive subscriber gains and we are excited for the upcoming premiere of season two of the Starz original series Boss next week,” Maffei continued. “In July, we physically settled our forward purchases of SiriusXM and Live Nation, increasing our ownership positions.”