MGM Still In Trouble With Lenders

Published 4 years ago by , Updated February 10th, 2012 at 9:38 am,

mgm logo11 MGM Still In Trouble With Lenders

THR is reporting that MGM is still in a financial quagmire. We’ve been reporting on the studio’s financial troubles for awhile now and last we heard, they were officially looking for buyers to come in an act as “strategic partners,” essentially allowing MGM to continue operating (albeit under new management).

The properties counted among the studio’s assets that we cared about here at Screen Rant were The James Bond franchise and Peter Jackson and Guillermo del Toro’s adaptation of The Hobbit. Last we heard, the former was “safe” and as far as the latter, Warner Bros. had stepped in to help shoulder the cost of production to make sure the film got started on time (and no doubt to snag a little of that Hobbit money).

However, reports are that the first rounds of buyer bids didn’t go so well. As in: nobody wants to fork up the reported $2.2. billion MGM would need to put a serious dent in the $3.7 billion clams they owe to their lenders.

Moelis and Co., the consultant company helping MGM steer through these troubled waters, invited only half of the initial round of potential buyers back for the second round of bidding. Potential buyers include Time Warner and Lionsgate (the latter is also currently making a grab for the Terminator franchise). This shrinking pool of buyers (and no doubt the underwhelming bids being made) are reportedly beginning to make MGM’s lenders very unsettled. “I don’t think there is a clear consensus on what the lenders will accept,” said a source close to the lenders’ camp.

If the bidding doesn’t go well, MGM will have to opt for debt restructuring, or the current lenders (there are more than 140) would become the new owners of the studio, with the current owners being squeezed out of their stakes in the company.

Some analysts are predicting MGM could ultimately sell for around $1.7 billion.

the hobbit bond MGM Still In Trouble With Lenders

What do we need to know, as lovers of James Bond and The Hobbit?  Only that we need to be rooting for whatever option keeps those two franchises running smooth. Although, I feel like with The Hobbit Warner Bros. (and/or whatever studio interested) will be there in a second with a nice big check and a smile if the production were to go off-track. Of course, the promise of controlling stake in the franchise would come with that kind gesture, no doubt. That Hobbit money is just too good to pass up.

We’ll keep you updated as more news of MGM’s struggle comes to light.

Source: THR

TAGS: james bond, the hobbit

9 Comments

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  1. Maybe Disney will buy them and they'll be one step closer to controlling the world.

  2. this is why I wish I was Bill Gates I would buy them for full price no messin around and then me a avid movie fan would actuly get to have full input on what movies I decide get made, man that would be sweet

  3. The trouble is MGM has been the victim of corporate raiders for decades now and while it has many admirers from afar no one with talent for running a studio, a real movie person has the financial backing, track record, and connections to make the commitment to save what is arguably someone else's legacy. It's rare to find that kind of community in such a population size these days. I won't be surprised if one of its former owners doesn't come in and swoop up a bargain basement deal and finish selling or capitalizing somehow what's left. They still have a movie library although nothing like they used to have and of course the two featured properties, logos, trademarks and some real estate.

    An era is slowly passing and a changing fast paced and technically driven industry seems to me to be what's left in the aftermath. Could this be the final decades of another U.S. dominated industry? Doesn't it seem as if the story assets are being wrung dry in preparation for a final sell off of the business? Hollywood Industries closed for business!

  4. Screen Ranters Unite! Here's our chance. I'll put up the first $10.00 CDN. Of course KantStandYa will have to put up at least $1 Billion of his own dough since he'll be in the driver's seat.

  5. Screen Ranters Unite! Here's our chance. I'll put up the first $10.00 CDN. Of course KantStandYa will have to put up at least $1 Billion of his own dough since he'll be in the driver's seat.

  6. Screen Ranters Unite! Here's our chance. I'll put up the first $10.00 CDN. Of course KantStandYa will have to put up at least $1 Billion of his own dough since he'll be in the driver's seat.

  7. maybe if mgm started making better movies that will make more money for them instead of thinking that james bond is the only thing they have. They used to be the biggest studio in hollywood.

  8. Hello , MGM I am a great lover of MGM throughout the years and I am wondering if the company is stil viable and will be around for some time yet?
    A wonderful company and the best studio in Hollywood I say , but it saddens me that we seem to be losing MGM, It is an American Icon that must be kept , and the way I see it is we need to bring back the stars and the musicals that made this mighty studio the best in the world .
    MUSICALS were its saving grace and I say again this may be it return to majesty. PLEASE KEEP MGM for the American dream machine it is.

  9. I love MGM and have all of my 74 years …………………..it must remain as a viable movie studio and the lion of film making………..
    It was and is still the king of the jungle …….AMERICA you must keep MGM from going into oblivion please !!!!! WE WANT MORE MUSICALS IN OUR LIVES … IT WAS ALRIGHT FOR THE 50′S AND IT COULD BE FOR THE NEW MILLENIUM … WHEN I DIE I WANT MGM TO BE THERE MAKING MUSICALS AGAIN .
    IT MUST !!!!! I AM AN AUSTRALIAN AND I KNOW THAT THERE A MILLIONS OF US THAT WOULD JUST LOVE IT TO BE AS IT WAS .

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