Business

‘Lion’ to trough

Lionsgate Entertainment is the latest media company looking to cash in on investors’ seemingly insatiable desire for the next big tech play.

Lionsgate is considering a spin-off of several digital assets, including its men-focused video ad network, Break Media, The Post has learned.

The potential spin-off could also house Lionsgate’s share of pay-TV service EPIX, its TV Guide and TVGuide.com assets and FearNet, a broadband and video-on-demand venture in the horror genre, sources said.

The businesses that Lionsgate may spin off account for between 15 to 20 percent of total revenue, which was $1.6 billion in 2010.

Media firms are looking at what value they might unlock following a string of tech IPOs such as Internet radio firm Pandora, which is looking to raise $100 million, and Demand Media’s recent $1.5 billion offering.

The intense interest is also being fueled by competition among Web giants like AOL, Yahoo! and Microsoft for content companies. AOL in particular has been snapping up content creators, including Huffington Post and TechCrunch, to boost its online presence.

A spin-off could value Lionsgate’s Web and TV assets at around $800 million — about equal to Lionsgate’s current market cap, according to executives familiar with the matter. Break Media alone could net a valuation of between $500 million and $600 million, said one executive.

Break Media is the third-largest video ad network behind Tremor Media and Bright Roll, according online tracker comScore. It also houses a string of Web sites aimed at men like Break.com.

Sources familiar with the talks said Lionsgate is conducting a bakeoff between bankers eager to do the deal but cautioned that the company is still mulling the idea.

Lionsgate, whose studio churned out film franchises such as “Medea” and horror flick “Saw,” said earlier this month it would look to dump noncore assets.

The company reported strong third-quarter revenue gains thanks to increases in DVD sales, box-office receipts and TV production. But it ended up reporting a quarterly loss of $6 million after spending almost $8 million fighting a takeover attempt by activist investor Carl Icahn.

Lionsgate acquired its initial stake in Break Media in 2007 for around $20 million. The firm later bought TV Guide network for $225 million in 2009, and almost immediately sold half the company to One Equity Partners for $123 million.

Lionsgate’s stock closed at $5.96, up 2.4 percent, on Friday.

catkinson@nypost.com