After a stormy year in which senior executives have left its ranks, a much-ballyhooed public offering failed to take off and it put itself up for sale, Artisan Entertainment has shifted strategy, taken itself off the block and begun negotiations to buy publicly traded Vancouver-based entertainment indie Lions Gate Entertainment Corp.
The negotiations, still at their early stages, would see Artisan pay between $100m and $150m for Lions Gate which encompasses film and TV production and distribution, a successful video distribution division, an international sales company and a 46% stake in Peter Guber's Mandalay Pictures. Ironically Lions Gate itself looked into buying Artisan, which has a film and TV library of over 2,600 titles, last year, as well as other companies including Harvey Entertainment and The Kushner-Locke Co. Lions Gate was unable to raise the financing to meet Artisan's asking price. It did, however, successfully acquire Trimark Holdings which has now been dismantled and folded in to Lions Gate's corporate infrastructure.
Lions Gate has a market capitalisation of some $108m; its share price has rocketed some 50% over the last ten days as word of the possible acquisition leaked out. Neither Lions Gate nor Artisan would comment on the reports.
Artisan, which is now solely run by film indie veteran Amir Malin, formalised its bid in a letter to Lions Gate on Friday.
Although details of how the two companies would be organised under an acquisition are as yet unclear, there are many areas of crossover including theatrical and home video distribution and feature film production. Artisan has two films going into production later this year - Iron Fist and Dirty Dancing 2 - as well as releases including Made, Soul Survivors, Van Wilder: Party Liaison and Novocaine. Lions Gate has a full slate of films scheduled for release this year including Bully, All Over The Guy, Lost And Delirious, Liam, Chelsea Walls, Frailty and The Cat's Meow.
If successful, the acquisition would further rationalise the increasingly bleak independent marketplace in North America. With Lions Gate out of the picture, film sellers and producers will be left with only one financially independent mini-major in Artisan/Lions Gate and a shrinking pool of smaller companies like Lot 47, Fireworks and IFC Films.