Lionsgate Cuts 45 More Jobs30 Mar, 2009 By: Erik Gruenwedel
Under siege from maverick investor Carl Icahn to cut costs, Lionsgate March 27 reportedly trimmed another 45 positions (8% of workforce), leaving the Santa Monica, Calif.-based mini-major with about 500 employees.
The layoffs, which are part of ongoing internal restructuring, included 27 employees and leaving another 18 positions vacant, reported The Associated Press.
A similar cut last year reduced about 40 positions, saving from $15 million to $20 million in annual corporate overhead. Lionsgate initiated a hiring freeze last summer.
The studio’s board March 26 issued a statement reiterating its neutral stance regarding Icahn’s desire to purchase $325 million in Lionsgate’s convertible bonds, including $150 million of convertible senior subordinated notes due 2024 and $175 million of convertible senior subordinated notes due 2025.
Scuttlebutt suggests Icahn’s move could be a precursor to a possible hostile takeover or forced sale of Lionsgate, which lost more than $93 million in the most recent quarter.
Separately, Icahn's former chief investment adviser, Mark Rachesky, increased his stake in Lionsgate to nearly 20% and is reportedly interested in placing a representative on the board.
A studio representative was not immediately available for comment.
Lionsgate shares were down 9 cents in midday trading March 30.