Alibaba Wants to Buy Lionsgate’s Shares

Alibaba Group Holding Limited (NASDAQ:BABA) earned $25 billion after the last month’s blockbuster IPO. The China-based company is now developing interest in acquiring Lionsgate Entertainment Corp. (NASDAQ:LGF)’s shares. Alibaba Group Holding Limited (NASDAQ:BABA) wants to gain about 37% of Mark Rachesky’s, the co-chairperson of Lionsgate Entertainment Corp. (NASDAQ:LGF), stake in studio.

Currently, Mark Rachesky owns 37.4% stake in Lionsgate Entertainment Corp. (NASDAQ:LGF) through his investment firm, MHR, which makes him the biggest shareholder in the company. According to some sources, Alibaba Group Holding Limited (NASDAQ:BABA) could acquire these shares no later than November, if a deal is struck. However, on Friday, it was reported that Mark Rachesky is willing to sell these shares. Mark Rachesky had refused to accept Carl Icahn’s victory in a proxy fight in 2011.

The representatives from both companies have refused to offer any comment regarding this. Meanwhile, Mark Rachesky, and representatives from his firm MHR, did not respond to the press’ requests to comment. MHR is based in New York and manages about $6 billion capital as of today.

Matthew Harrigan, Wunderlich Securities’ analyst, said that Rachesky would be commanding a fortune under his existing shares in the Lionsgate Entertainment Corp. (NASDAQ:LGF) studio. This signifies the unique position of the company as content engine.

This summer, Lionsgate Entertainment Corp. (NASDAQ:LGF) and Alibaba Group Holding Limited (NASDAQ:BABA) signed a pact to provide streaming services for subscribers in China. The new business is called Lionsgate Entertainment World. The streaming service will offer all movies from the “Twilight Saga”, “Mad Men”, “Divergent” and “Hunger Games: Catching Fire”.

It has been reported that the CEO of Alibaba Group Holding Limited (NASDAQ:BABA), Jack Ma, will lead a delegation to hold a conference with CEOs of other Hollywood studios. This will take place sometime in the next week. The meeting will include Michael Lynton from Sony, Brad Grey from Paramount, Walt Disney, and Universal Studios. Alibaba Group Holding Limited (NASDAQ:BABA) is exploring potential investments and content acquisitions. Jack Ma often used to stop by at Lionsgate Entertainment Corp. (NASDAQ:LGF) during trips to Hollywood.

Jon Feltheimer, the CEO and co-chairperson of Lionsgate Entertainment Corp. (NASDAQ:LGF), has a scheduled trip to Hong Kong in the nest week. This is an entirely separate plan, which was formulated so that Feltheimer could deliver at the CASBAA Convention 2014 six months ago.

When the deal between Lionsgate Entertainment Corp. (NASDAQ:LGF) and Alibaba Group Holding Limited (NASDAQ:BABA) was announced in the summer, Feltheiemer had praised Alibaba Group Holding Limited (NASDAQ:BABA) as a respected brand that is well-known and much-loved by the Chinese consumers. He also said that the company represented a world-class brand. Feltheimer went ahead and declared that his company would love to work with the likes of Alibaba Group Holding Limited (NASDAQ:BABA); an entrepreneurial company. The launch of the combined streaming business in China shows how committed the two companies are in providing innovative services to their customers. Both companies show full commitment to providing quality content on digital platforms at a global level.