MGM Officially For Sale

Published 5 years ago by , Updated March 9th, 2013 at 1:39 pm,

mgm logo1 MGM Officially For Sale

Back in September we reported on the financial troubles of movie studio Metro-Goldwyn-Mayer (or MGM for short). The studio has racked up a debt of a whopping $3.5 billion (yowza!) and, at the time, it was, “teetering on the edge of bankruptcy.” The company has two big properties currently in its possession, those being the Bond franchise and the upcoming Hobbit adaptation.

Luckily, but not surprisingly, both those properties are quite safe, with Warner Bros. stepping in to foot the bill for production on The Hobbit, while also handling domestic distribution for the film (which will be split into two parts). As I said, no surprise there that the two franchises are safe (guaranteed box office bank if ever there were any), but it was nice for that to be made official.

However, specific film properties aside, the trouble for MGM at large is that it was possibly going to auction of its assets. And now, only a couple of months later, we get word that’s exactly what’s happening. Variety reports that MGM has been given an extension until January 31st, 2010, from paying interest on their massive debts (which is the second time an extension has been granted, the first being until December 15th), and is going to be using that time to start, “a process to explore various strategic alternatives including operating as a standalone entity, forming strategic partnerships and evaluating a potential sale of the company.”

Sources close to MGM say that the studio’s investment bankers, Moelis and Co., are overseeing the sales process. However MGM’s current management will remain in place to take care of feature development and the general continuing of production. A statement issued on Friday from MGM reads:

“The lenders took this action in support of the company’s ongoing efforts to develop and evaluate long-term strategic alternatives to maximize value for its stakeholders… MGM appreciates the continued support of its lender group for the process it is undertaking.”

So what assets does MGM have to offer? Well, they include the likes of a 4,000-title library, the logo, the United Artists operations, rights to the James Bond franchise and half-ownership of the upcoming Hobbit films. You’d immediately think that other studios would be licking their lips right about now and you’d be right: Possible buyers include Time Warner, News. Corps (which owns 20th Century Fox) and Lionsgate (Get it? LIONsgate? MGM’s logo is a roaring lion… Okay, never mind…).

the hobbit bond MGM Officially For Sale

There was a rumor at the beginning of last month that the Bond franchise was maybe moving from MGM to Fox, but soon thereafter MGM contacted the guys over at Film School Rejects directly to let us all know that wasn’t the case. However, in light of this recent news, even though Bond won’t be moving studios, per se, if another studio snaps up MGM then the Bond franchise would by extension be owned by someone else.

Man, this whole MGM ordeal really is tossing and turning in a relatively short period of time, isn’t it?…

What do you think of MGM being officially for sale in light of their recent financial troubles? Which studio do you think will make the purchase?

Stay tuned for developments.

Source: Variety

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TAGS: james bond, the hobbit

16 Comments

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  1. Walt Disney rules

  2. I would hope that one of the following:

    *UA splits off from MGM.

    *MGM does not go entirely into the sunset, but rather becoming more of a distributor of indie/low budget fare.

    *Lionsgate buys MGM; gets rid of the name Lionsgate, becomes MGM, Lion and all.

  3. Darren Seeley, how long have you been working on this plan? Holy shee±

    Fricken mastermind!
    :-)

  4. MGM has been bought and sold so many times in the past 40 years, and each time the outcome has been to sell off parts of the studio to pay for the sale. In 1970, Kerkorian sold off the studio’s backlot. Kerkorian also sold MGM’s PRICELESS movie memorabilia for what experts described as a fire-sale. He sold the profitable record label. He shut down production to a trickle in the 70′s to focus on his casinos, using MGMs glamourous credentials. Realizing that a movie studio is NOT a movie studio worth anything if it doesn’t make movies, he then bought United Artists to revamp MGM in 1980; then sells MGM/UA to Ted Turner, who keeps MGM”s classic movies but sells the studio back to Kerkorian to pay for HIS purchase. Each time someone has bought the studio, they sold off parts of the MGM leaving a much weaker, smaller and less stable company. Why can’t someone buy MGM and grow the kind of business that this fabled studio deserves, like Isner did with Disney? MGM is one of the most recognizable corporate identities in the world with a lot of cache for class and glamour.

    I would like to see MGM become a part of either Time Warner or LIonsgate. Obviously being bought by Time Warner,(who once was the second biggest investor in the sixties through Time Inc., before the Time Warner merger many years later) They have deep pockets and would surely know how to make MGM a sister right-full entity along Warner Bros and New Line studios. Also, the fabled movie studio and priceless MGM film library would reunited, keeping MGM’s legacy preserved. MGM would also have a studio to work from.

    I hope that Lionsgate buys MGM for very different reasons. Lionsgate already has a studio, in Canada. They are a strong, successful studio that could use the cache that MGM would provide.Lionsgate has one of the largest film libraries in the world: only Warner Bros. and MGM have a bigger library. Obviously MGM’s Leo would fit perfectly with a company that is named Lionsgate. One studio could produce the more main-steam prestige movies (MGM) and the other, the low budget yet highly profitable fare that makes a studio money (Lionsgate). MGM’s former chairman, Harry Sloan ran Lionsgate several years ago and could be prophet back in as chairman.

    Either scenario would be better than to have a once great studio be sold apart in pieces. MGM was once the greatest, most powerful studio in Hollywood. It would be a shame to let such a legacy be torn apart and forgotten, especially when other studios like Warners and Disney thrive. I hope someone saves this great part of Hollywood’s, and even Americas’ history.

  5. Ive got a few thousand, anyone else want to put in? Maybe get a decent Bond film out of them….

  6. “a process to explore various strategic alternatives including operating as a standalone entity, forming strategic partnerships and evaluating a potential sale of the company.”

    In short we have no frickin idea what we are going to do and we hope someone with really deep pockets bails us out…

  7. DrSam

    Count me in – I got $20 bucks.

  8. @Beatnik2, I agree, shame to have this once great studio sold to pieces. It is a part of Hollywood history but to the “businessmen/butchers ” that does not matter, only the money they will make from hacking it to pieces.
    It all started with Kerkorian who did not give a damn about movies or history.
    MGM has a library of around 4000 movies and they could start their own (paying)TV chanel instead they are showing them for free on channel #5.2. Go figure! The only one of the 5 major studios without a back lot (Columbia,Paramount, Warner Bross, 20th century Fox and MGM)? The lion that used to roar, now just whimpers – Louis B. Mayer must be turning in his grave. What a shame!

  9. A co-op studio under the big lion banner would be kind of neat, especially to own a piece of it. But put in perspective 3000 millionaires donating a million each couldn’t cover MGM’s debt. Even then what of operating capital? DVD is a shrinking market with streaming content coming on strong. Best Buy is even getting into the market. With such an incredible debt and an investment probably in the millions if not billions to make something like MGM Streaming a viable reality you need the capital of a Sultan and a small army of highly skilled people to pull it off…

  10. It is really a crime MGM to be for sale once again! All these
    persons who -for 40 years now- brought the once mighty studio
    in such miserable condition, are irresponsible or cruel and
    heartless.

    Iam a 69 years old Greek citizen, born in Alexandria (Egypt) and living here in Athens (Greece) from 1963. I have grown up all these years with Hollywood’s films and I feel pain to think that Metro-Goldwyn-Mayer soon maybe cut in pieces. All you good and honest Americans, wake up and don’t let this happen! Save the studio that for decades was the greatest, the finest, the most glamorous not only in Hollywood but in the whole world! MGM is a tradition, a landmark for your nation. Their films for years and years were the best
    ambassadors of the United States all over the world. MGM now is in deadly danger. Do something before it’s too late! Protect and save Metro from all those greedy or awkward and
    incapable persons, which all of them want to destroy and fade-out the legacy of its glorious past.