• By
  • Maureen Farrell
LIONSGATE/EVERETT COLLECTION

Lions Gate Entertainment Corp.’s stock is up 8% Wednesday morning after the company announced the addition of perennial deal maker John Malone to its board of directors.

The deal will also entangle Lions Gate and Starz, the premium cable-channel operator, which was split off from Mr. Malone’s Liberty Media Corp. in 2013. Mr. Malone will give some of his Starz stake to Lions Gate for 3.4% of Lions Gate’s shares. The exchange will give Lions Gate a 4.5% stake in Starz and 14.5% of the voting power. Starz’s shares are up nearly 5%.

So what does this mean?

Lions Gate, the entertainment company behind the movie franchises “The Hunger Games” and “Twilight” and a host of hit television series, has been continuously looked at as a takeout candidate, and Starz has reportedly been looking for a buyer too.

But Matt Harrigan, an analyst at Wunderlich Securities, thinks a sale of either company in the near-term is less likely now. “I don’t think it’s likely that Lions Gate would sell to Starz,” he said.

Doug Creutz, an analyst at Cowen Group, agrees. He said that if Lions Gate was looking to sell right now, they’ve complicated a potential deal for any buyer by adding Mr. Malone, who is well known to be a savvy negotiator.

Lions Gate’s chairman and largest shareholder, Marc Rachesky, is the ultimate decision maker in any deal for the production company. Investors and analysts have been watching to see Mr. Rachesky would sell out of his 37% stake in the company.

Mr. Harrigan does see  a possible deal that could come from Mr. Malone’s involvement. Mr. Harrigan thinks that perhaps Mr. Malone could help push for a tie-up between Starz and the cable channel EPIX, in which Lions Gate holds a stake.

Additionally, he said, the deal is a stamp of approval for Lions Gate from Mr. Malone, who has historically been wary of the movie business. Mr. Harrigan said Mr. Malone’s involvement shows his faith that Lions Gate has a more diverse business model. Lions Gate’s most successful movie franchise, “The Hunger Games,” is nearing an end after the second-to-last movie in the series opened in November, and analysts and investors have expressed concern about the company’s ability to generate more blockbusters of that magnitude.

Lions Gate has been the subject of takeover battles in the past. In 2010, the film company defended itself successfully against Carl Icahn‘s hostile takeover attempts. At the time, Mr. Icahn was offering $6 per share for Lions Gate. Its stock is now trading above $30 per share.