Lionsgate shares pop amid Legendary deal talk

Shares in Lionsgate Studios have soared almost 20% following reports that Dune and Godzilla firm Legendary Entertainment is exploring a deal for the Mad Men and Yellowjackets outfit.

Discussions between the companies, first revealed by Bloomberg, are at an early stage and come just weeks after Lionsgate’s formal separation from Starz saw it become a separately traded company.

That protracted deal, which had been in the works for years, had been sought to enable Starz and Lionsgate to more easily strike M&A deals relevant to their production and cable/streaming businesses.

Lionsgate is led by chief exec Jon Feltheimer and employs around 1,400 people globally, with the company focused on production and distribution rather than streaming, following its move to ditch Lionsgate+ internationally three years ago.

Lionsgate then spun off its Mad Men, Yellowjackets and John Wick production outfit Lionsgate Studios in a merger in 2024 with a special purpose acquisition company (SPAC) named Screaming Eagle Acquisition Corp, which was floated in May.

Lionsgate Studios’ IP library runs to 20,000 hours and includes major movie franchises including The Hunger Games, John Wick and Twilight.

Legendary Entertainment, meanwhile, has produced shows such as Apple TV+ series Monarch: Legacy of Monsters and Netflix animation, Tomb Raider: The Legend of Lara Croft.

a major player in the movie business with features such as A Minecraft Movie and Dune. It is co-owned by management and Apollo Global, following a buy-out from China’s Dalian Wanda Group last year.

Shares were trading just under $7 apiece on Friday, meaning Lionsgate Studios is now valued at north of $2bn.