Does the Eye Network want to add cable TV hits "American Gods," "Outlander" and "Power" to its roster? Tech site The Information reported Friday that CBS made a $5 billion offer to acquire Starz, the media company that merged with TV and movie studio Lions Gate in 2016.
Shares of the two classes of Lions Gate stock (LGFA) (LGFB) surged more than 10% on the report. CBS (CBS) was flat.
The Information said that Lions Gate turned down the offer, which makes sense. Lions Gate only bought Starz a little more than 2 years ago. It paid $4.4 billion. So a $5 billion paycheck from CBS would represent less than a 6% premium.
So it will be interesting to see how badly CBS CEO Joseph Ianniello wants Starz. Shares of CBS are down more than 6% in the past year in the wake of the ouster of longtime chief Les Moonves following a sexual harassment scandal.
The stock is lagging ABC owner Disney (DIS) and NBC Universal parent Comcast (CMCSA). The Lions Gate chatter also comes at a time when there is rampant speculation that CBS may want to reunite with its former movie studio sibling Viacom (VIAB).
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