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Lionsgate chairman to sell 10 million shares

Orange-is-the-New-BlackLionsgate Entertainment chairman and key shareholder Mark Rachesky is to sell 10,000,000 shares in the US studio.

Rachesky is offering the shares via his investment firm, MHR Fund Management, and gives underwriter J.P. Morgan Securities a 30-day option to purchase 1,500,000 shares.

This will reduce Rachesky’s stake by about 7% from the current 35%, and none of the proceeds will go towards financing Lionsgate’s programming or film businesses.

Lionsgate’s share price has fallen on the news, though the US$33.68 trading price is still up considerably on this time last year.

In December, reports emerged Lionsgate had talked to Chinese group Dalian Wanda about a company sale, though it is thought Rachesky still wants to keep control of the firm. Another Chinese firm, Alibaba, was rumoured to be interested in a deal, too.

Last month it secured a US$375 million film financing pact with Chinese broadcaster Hunan TV.

Further adding to mounting speculation, John Malone joined the firm’s board earlier this year after a share swap deal with the cable TV mogul’s Starz Entertainment.

Lionsgate is behind series such as Mad Men, Orange is the New Black and Nashville.