Studio Business of Lions Gate Entertainment Corp. (NYSE : LGF.A) entered into an agreement to acquire Screaming Eagle Acquisition Corp. (NasdaqGM:SCRM) for $2.6 billion in a reverse merger transaction on December 22, 2023. As part of transaction, consideration share paid equivalent to $2.677 billion at share price of $10.7, and assumed Lionsgate Studio net debt of $1.748 billion. Upon closing of the transaction, it is expected that Lionsgate shareholders will indirectly own an approximately 87.3% stake in Lionsgate Studios, while Screaming Eagle public shareholders, founders and PIPE investors will own approximately 5.7%, 0.7% and 6.3% of Lionsgate Studios, respectively. The resulting issue will be launched as Lionsgate Studios Corp. (?Lionsgate Studios?). Common shares of Lionsgate Studios will trade separately from Lionsgate?s Class A (LGF.A) and Class B (LGF.B) common shares as a single class of stock.

Screaming Eagle founders and independent directors will collectively forfeit approximately 14.5 million of their founder shares and will retain approximately 2.0 million common shares upfront and Screaming Eagle founders will be entitled to receive an additional 2.2 million common shares if the trading price of Lionsgate Studios common shares increases 50% from $10.70. In connection with the transaction, the Screaming Eagle founders will forfeit all of their Screaming Eagle private placement warrants. The transaction is subject to certain closing conditions, including regulatory approvals and approval from the shareholders and public warrant holders of Screaming Eagle, and is expected to close in the spring of 2024. Net proceeds from the transaction will be used to enhance Lionsgate?s balance sheet and facilitate strategic initiatives including the eOne acquisition which is scheduled to close by calendar year end.

Morgan Stanley & Co. LLC (?Morgan Stanley?) is acting as financial advisor to Lionsgate. Citigroup Global Markets Inc. (?Citigroup?) is acting as financial advisor to Screaming Eagle. Citigroup and Morgan Stanley are acting as co-placement agents for Screaming Eagle with respect to the common equity financing. Wachtell, Lipton, Rosen & Katz is acting as legal advisor to Lionsgate and Denton?s Canada LLP is acting as legal advisor to Lionsgate in Canada. White & Case LLP is acting as legal advisor to Screaming Eagle and Goodmans LLP is acting as legal advisor to Screaming Eagle in Canada. Davis Polk & Wardwell LLP is acting as legal advisor to Citigroup and Morgan Stanley in connection with their roles as co-placement agents. Screaming Eagle Acquisition has engaged Morrow Sodali LLC to assist in the solicitation of proxies. Kroll, LLC, operating through its Duff & Phelps Opinions Practice, acted as financial advisor and fairness opinion provider to Screaming Eagle Acquisition. In connection with the rendering of the Opinion to the Screaming Eagle Acquisition Board, Screaming Eagle Acquisition agreed to pay Duff & Phelps an aggregate fee of $575,000.