SANTA MONICA—Cable and satellite network Starz announced on Thursday, June 30 that it would be bought out by Lionsgate. Lionsgate is the studio behind the “Hunger Games” films. According to reports, Lionsgate will buy Starz for a combination of cash and stock totaling $4.4 billion. Lionsgate will complete the deal to acquire the Colorado based company by the end of the year.

Starz runs its namesake cable channel, Starz Encore and MoviePlex. According to the Press Democrat, Lionsgate wants to run its movies and TV shows on Starz’s channels.

The companies released a joint-statement which said, “The transaction significantly increases the combined company’s content- creation capabilities, enhances its leadership in premium scripted programming and scales its global distribution footprint across mobile, broadband, cable and satellite platforms.” Adding that the deal “is expected to generate significant revenue and cost synergies.”

The agreement is resultant of a culmination of on-again/off-again talks between both companies; John Malone, the chairman of Liberty Media and Liberty Global, owns stakes in both companies as well as Discovery Communications and has voiced the importance of boosting the scale of smaller content companies amid pay TV consolation and globalization.

Lionsgate CEO Jon Feltheimer described the partnership as, “A combination that unlocks significant, immediate, and long-term value for our stakeholders”; the collaboration that Feltheimer called a “global content powerhouse” will invest approximately $2 billion annually in new content and provide “increased scale to compete even more effectively and capitalize on growth opportunities in a fast changing marketplace,” according to the Hollywood Reporter.

As part of the Starz deal, Feltheimer will remain CEO of the combined entity and Michael Burns will remain as vice chairman; the president and CEO of Starz, Chris Albrecht, will remain the president and CEO of Starz, running the premium cable network, and joining Lionsgate’s committee with expanded duties.

The Press Democrat indicated that Lionsgate will pay holders of Starz Series A stock $18 in cash and 0.6784 of a Lionsgate share. Starz Series B stockholders will receive $7.26 in cash and 1.2642 of Lionsgate stock in an announcement on Thursday.

Wall Street observers have said the combination between Lionsgate and Starz could eventually acquire further content companies that aren’t entertainment conglomerates.

Bloomberg.com, indicated that the companies have been the topic of merger speculation since February 2015. Both companies exchanged minority stakes and Starz’s board member Malone joined the Lionsgate board. Malone’s two other companies, Liberty Global Plc and Discovery Communications Inc., later acquired stock in Lionsgate.

Lionsgate also owns stock in Epix and Pop channels. Starz also owns Anchor Bay Entertainment, which distributes movies on DVDs.

FBN Securities analyst Robert Routh said the stock exchange agreement is a “precursor” to an eventual merger of the two entertainment companies.

By Shatai Melvin and Sabrina Bush