Liberty Media has started sending out feelers to potential buyers for its premium channel Starz.
Liberty has reached out to media companies ahead of the expected mid-January spinoff of its pay-TV division, which includes the Starz and Encore channels, sources said.
In August, John Malone’s Liberty announced plans to split the company, setting the stage for a sale of the Starz unit once the separation is complete.
CBS, Fox, Viacom and Spanish-language broadcaster Univision could be interested, one source said. Reps for all the firms declined comment.
(News Corp. owns Fox and The Post.)
“The obvious interested parties would be their competitors, like Time Warner or CBS,” said Jimmy Schaeffler, a pay-TV expert with the Carmel Group.
“The challenge is they have two competitors who have very deep pockets and are more successful.”
Starz, home to original series “Spartacus,” has lagged rivals Time Warner’s HBO and Showtime, part of CBS.
Starz, with around 56 million subscribers, charges pay-TV distributors an average of $2.01 per subscriber a month, according to SNL Kagan estimates. By comparison, HBO commands $7.71.
Starz’s operating revenue is $1.3 billion, and it has a cash flow of $414 million, Kagan estimates.
Liberty has been sounding out parties for years, on and off, but has had few takers, one source familiar with the situation said.
Recently, Starz was dealt what many saw as a blow when it didn’t extend its current deal for Disney movies, which ended up going with streaming video service Netflix.
Starz said the money it would have spent on a Disney renewal will be plowed into an original series instead.
“It’s a very tough sale,” said Janney Montgomery Scott analyst Tony Wible, adding “Without Disney, it is a liability.”
The rules for a tax-free spinoff prevent Liberty from negotiating a sale to
another buyer until the separation is complete.
A spokeswoman for Liberty declined comment.