‘Dune' studio Legendary weighs buying Lionsgate Studios

Los Angeles Times

10 hours ago

Legendary Entertainment, the independent film and TV studio behind the 'Dune' trilogy and 'A Minecraft Movie,' is considering a takeover of Lionsgate Studios, according to people familiar with the matter.
Legendary, which is backed by Apollo Global Management, first approached the company after Lionsgate finalized its separation from the Starz Entertainment Corp. TV network and streaming service in May, said the people, who asked not be named as the information is private.
Those talks centered on a potential partnership to produce a handful of films so that Legendary could gauge how the two companies worked together and whether it should ultimately proceed with a takeover offer, the people said.
Representatives for Legendary and Lionsgate declined to comment. Lionsgate shares jumped 8.6% after Bloomberg reported the news and ended the day up 20%.
Lionsgate, which currently has a market cap of $1.8 billion, owns the rights to popular film franchises including 'John Wick,' 'The Hunger Games' and 'Twilight,' and would provide Legendary with a theatrical distribution network. Lionsgate has also produced TV hits including AMC's 'Mad Men.'
'A Minecraft Movie,' which was co-produced by Legendary and released by Warner Bros. Discovery's film studio in April, is the highest grossing movie at the domestic box office so far this year, having sold $423.9 million worth of tickets in the US and Canada.
Legendary's exploration of a Lionsgate takeover 'is sensible, given it's a pure-play studio,' Bloomberg Intelligence analyst Geetha Ranganathan wrote in a note. A deep library of content accounts for a third of Lionsgate's revenue at a high profit margin, she noted. 'We suspect that Legendary's interest could spur others to potentially consider bids.'
Josh Grode, Legendary's chief executive officer, said in a 2024 interview with Bloomberg Businessweek that he planned to tap Apollo's finances for takeovers in the entertainment industry that would collectively be worth billions of dollars.
Last year, Legendary and Apollo were linked to a potential acquisition of the Paramount Pictures film studio, and were later involved in a potential acquisition of parent company Paramount Global. That business is instead being acquired by David Ellison's Skydance Media.
Buckley and Shaw write for Bloomberg.