A private-equity firm led by former Treasury Secretary Steven T. Mnuchin has acquired a significant stake in Lions Gate Entertainment, the studio behind popular movie franchises such as John Wick and Hunger Games.
Mnuchin's firm, Liberty Strategic Capital, purchased an additional 2.5 million class A shares of Lions Gate Entertainment between August 10 and 30 for a total of $18 million. The average price per share was $7.27. This acquisition increased Liberty's overall ownership to 4.6 million Lions Gate shares, representing a 5.5% stake.
As Liberty crossed the 5% ownership threshold, it was required to disclose its stake to the Securities and Exchange Commission (SEC). The firm filed a 13D form, typically used by activist investors to indicate their intention to engage with the company's management and suggest changes.
In its filing, Liberty indicated that it may provide suggestions or proposals regarding Lions Gate to management or other investors. One potential topic for discussion is Lions Gate's proposal to spin off its studio business into a separate public company.
Lions Gate stock experienced a significant decline of 66% in 2022, impacted by strikes by unions representing Hollywood writers and actors that disrupted television and movie productions. However, the stock has shown signs of recovery this year, with a year-to-date gain of approximately 39% to $7.93 as of Thursday's trading.