Vancouver: On Jan. 4, Lions Gate Entertainment closed a us$33-million ($49-million) financing with a group of investors including Seattle-based magnate Paul Allen and two European broadcasters – a vote of confidence the company hails as a milestone that will kick start a new era of growth and investor interest.

The financing, the company’s fourth since going public in 1997, will spark new acquisitions and production and means it will take its Lions Gate Studio complex, listed at $42 million, off the market, says company ceo Frank Giustra.

‘It’s the single most significant event in the company’s history,’ says Giustra, referring to the business profile of the new investors and their geographic diversity. ‘It’s a great way to start the millennium.’

The participation of SBS Broadcasting sa, a European broadcaster, and Tele-Munchen, a German broadcaster, will open the doors to more European partnerships and future output deals, says Giustra. He adds that Allen’s Vulcan Ventures has a growing interest in cable and distribution and its involvement in Lions Gate represents a commitment to content.

Other high-powered investors now involved include: Capital Research and Management Group; Fidelity Investments; Future Media Corp.; Jon Feltheimer, former executive with Sony Pictures Entertainment; and Jamie Dimon, former cochair of Salomon Smith Barney.

‘[The new financing] will give us the fire power to grow through increased acquisition and production,’ says Giustra. ‘We will be quite aggressively involved in the consolidation of the industry.’

And the markets seemed to like the new infusion of cash and credibility, with Lions Gate shares jumping at one point $0.70 on the Toronto Stock Exchange on the day of the announcement when major stock market indexes were in sharp decline. On Jan. 4, Lions Gate shares were trading up at $3.75 per share on the tse; the 52-week high and low are $6 per share and $2.20 per share, respectively. On the American Exchange, shares traded at us$2.63, an improvement over the day but still off the 52-week high of us$3.94.

(Markets may also be excited by the domestic box office performance of two Lions Gate films. At year end, Dogma had earned us$29 million [$42 million] and Sleepy Hollow had earned us$93 million [$135 million].)

Underwritten by Yorkton Securities, the financing comprised preferred shares – convertible at us$2.55 into 13 million common shares – and 5,525,000 common share purchase warrants, exercisable at us$5. Gross proceeds were us$33.2 million ($48.2 million).

Giustra did not specify what new production would be greenlit by the new investment.

However, he did say that ‘several’ new Vancouver-bound television titles would appear on the calendar 2000 slate and that the increased volume would allow the company to keep its Lions Gate studio asset, which was listed in August with the intention of freeing up cash.

‘We probably won’t sell it now,’ he says.

Nor does he divulge any information about potential takeover targets. He says only that Lions Gate is looking at the general sectors of film and television, distribution and broadcasting.

With the new financing, Tele-Munchen chair Herbert Kloiber, sbs vice-chair and coo Howard ‘Woody’ Knight, and industry veteran Jon Feltheimer join Lions Gate’s board of directors.