Liberty Media Corp.
) has completed the spin-off of its Starz Entertainment segment
as a separate entity. According to management, the spin-off of
Starz will unlock the latter's value by optimizing its capital
structure and enabling Starz to find several alternative ways and
partnerships for both content creation and distribution. At the
end of the third quarter, total subscribers base of Starz
increased 9% to 20.8 million while its sister TV channel Encore
had 34.3 million subscribers, up 5% year over year. Together,
these two channels command 55.1 million subscribers.
Starz is currently trading at NASDAQ as
). The company is famous for its premium movie channels and
competes primarily with HBO of
Time Warner Inc.
) and Showtime of
). At present, HBO has about 39.5 million subscribers whereas
Showtime has nearly 21.3 million subscribers.
Last October, Starz launched its two TV Everywhere services
with Cox Communications Inc. The two online authenticated
services are known as STARZ PLAY and ENCORE PLAY. Later, the
company also launched its third streaming services called
MOVIEPLEX PLAY with Cox. All these three services collectively
offer 1,500 premium movies and TV programs every month.
Initially, STARZ PLAY and ENCORE PLAY will be accessible
through Internet and iPhone, iPAD, and iPod through Wi-Fi and
wired broadband connections. However, Starz stated that mobile
connectivity, access through gaming consoles and availability of
these services on Android-based devices will be launched later
on. Furthermore, Starz is trying hard to enter into similar types
of deals with other large pay-TV operators.
Starz currently has about $1.1 billion of debt and access to a
$450 million bank credit facility. Liberty Media earlier stated
that the spin-off is envisioned to provide a cash dividend of
$1.8 billion to the company. We believe that the spin-off of
Starz will help Liberty Media to increase its stake in
Barnes & Noble Inc.
Live Nation Entertainment Inc.
), together with
SIRIUS XM Radio Inc.
). Liberty Media recently got regulatory approval to control more
than 50% stake of SIRIUS XM.
BARNES & NOBLE (BKS): Free Stock Analysis
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STARZ-LIB CAP-A (STRZA): Free Stock Analysis
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