Liberty spinoff Starz up 10% in first day of trading
Starz Entertainment ended its first day of trading nearly 10 percent higher on Monday following Liberty Media's spin off last week of the company known for its premium movie channels.
The shares finished up $1.39, or 9.79 percent at $15.59 a share.
Liberty announced in August that Starz, which runs eponymous movie and TV channels, as well as the Encore movie channels, would become a separate listed company.
Starz currently has about $1.1 billion of debt and access to a $450 million bank credit facility, the company said in a statement late on Friday.
Some board members of the company include influential music executive, Irving Azoff, former DirecTV chief programmer Derek Chang, CEO Christopher Albrecht, Gilt Group founder and chairman Susan Lyne and Warner Music group chief operating officer Robert Wiesenthal.
Analysts view Starz, which competes with HBO and Showtime, as a potential acquisition target. The Starz channel has 21 million subscribers, while Encore has 34 million. Macquarie analyst Amy Yong estimates that HBO, the leader in premium TV which is owned by Time Warner Inc, has 39.5 million subscribers and that CBS-owned Showtime has 21.3 million.
Yong said in a research note that a large media company could help improve Starz' margins by "more extensive distribution, producing more content hours" and by commanding "higher rates in affiliate negotiations."
Janney analyst Tony Wible called movie channel Epix "an ideal buyer" for Starz, also in a research note.
Greg Maffei, the CEO of Liberty Media, said at an investor conference last week, "I don't know whether Starz gets
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