12:19 PM PDT 7/1/2016 by Etan Vlessing Etan Vlessing

The deep-pocketed media mogul, armed with an $8 billion war chest, is said to be hunting for more acquisitions to build upon the Lionsgate-Starz combination. Some of the deals might even come from properties he already owns major stakes in.
John Malone is on a mission with his latest media mashup: Take on the likes of HBO and Showtime by building the newest Hollywood conglomerate.
His $4.4 billion tie-up between Lionsgate and Starz will get him part of the way there. But, the billionaire media mogul is going to need to build on the rich pipeline provided by the mini-major Lionsgate as he navigates the radically-changing ways that people absorb content.
Analysts believe the best way to take on challengers like Netflix, Hulu and Amazon will be to build. And he’ll have a big war chest to do it – Malone has amassed an $8 billion fortune in a series of media deals over the years.”What’s he (Malone) is looking to do is pursue the same kind of consolidation on the content side as we saw him execute on the distribution side,” said Tuna Amobi, a Wall Street analyst at S&P Global Market Intelligence.
So, what is potentially on his shopping list? Industry insiders point to media and tech names such as AMC Networks and Scripps Networks Interactive. There’s also speculation that Malone might try to chip away at some of Viacom’s properties as that company continues to face a Wall Street backlash to beef up the company’s bottom line.
There’s also an opportunity to roll up big names that Malone already holds stakes in. He owns a chunk of Discovery Communications, which controls the Discovery Channel and Animal Planet. He has a 25 percent voting stake and is chairman of Europe’s largest cable company, Liberty Global; and also owns a big chunk of cable giant Charter Communications.
“Malone always has a greater vision for assets he’s interested in and his ambitions go beyond just a studio-premium channel combo. Over time, Lionsgate-Starz could become a meaningful streaming alternative to Hulu, Netflix and others with global reach,” said Macquarie Securities analyst Amy Yong.
As for beefing up the company’s streaming reach, analysts see an almost endless pipeline coming from the Lionsgate-Starz deal. The Hollywood studio with its fast-growing TV production arm can help Starz grow its original series offering after, unlike HBO and Showtime, long relying on third-party content.
Beyond pay TV, Starz has been moving to direct-to-consumer outside the U.S. after bigger rivals like HBO and Showtime already leveraged the Internet with OTT apps and stand-alone services.
“Starz has a viable platform for movies and original content, and now with Lionsgate and its (movie) franchises and TV, that speaks to a much more formidable competitor,” Amobi said.So expect sequels to the Lionsgate and Starz merger as Malone’s track record speaks to continued deal-making for even greater scale and negotiating strength when doing business with Netflix or cable and satellite TV distributors.
To be sure, Wall Street observers don’t Starz coming near to HBO in scale and original content anytime soon. “It (Starz) is well behind HBO, which has kept original productions at about 50% of output for many years,” said John Bird, a media analyst with UK-based Futuresource Consulting, “and, more recently Netflix, which has bet heavily on original series following the global success of House of Cards.”
That has Starz facing a hard slog to offer content to rival what’s available on HBO, Netflix and other industry giants. Analysts believe Malone will at least be able to chip away and narrow the gap of some of its more well-established competitors rather than toppling them.
He sees the upside for Starz from its combo with Lionsgate coming instead in better negotiating strength when gunning higher subscription fees from cable and satellite distributors, as well as digital streaming revenues from Netflix and Hulu. And that should get smaller entertainment companies in John Malone’s universe some way to compete against larger Hollywood monoliths.
“As you think about the potential upside of this deal, they’re just looking to use this as a vehicle to advance their motion picture and television businesses, and maybe to get into other revenue streams, such as video games and location-based initiatives, where being bigger can help,” Amobi argued. 



Source: Hollywood Reporter – Top Story