Lionsgate on Wednesday said it entered into a stock agreement with affiliates of billionaire John Malone.
Shares of Lionsgate jumped more than 7 percent in premarket trading immediately following the report. (Get the latest quote here.)
Lionsgate will exchange newly issued shares representing about 3.43 percent of its outstanding common stock for a portion of Series A and Series B Starz common stock held by Malone and his affiliates. That represents about 4.51 percent of Starz common stock outstanding and 14.50 percent of the total voting power of Starz common stock.
Malone will remain Starz's largest voting shareholder, with an approximate 6.1 percent equity interest and about 32.1 percent of the total voting power of Starz.
After the deal is completed, Malone will join Lionsgate's board.