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Yesterday I received a tip from a reliable source in film financing circles telling me that Goldman Sachs had been retained to shop MGM. "It's doubtful that something will come out of the process. But one never knows," my insider told me. Well, tonight Business Week's Los Angeles Bureau Chief Ron Grover is reporting that the proposed pricetag is a whopping $5.2 billion and the strategic buyers being sought are "other entertainment companies that would likely fold MGM into existing operations". Grover says already the Indians have passed (i.e. Reliance ADA Group, which is financing DreamWorks 2.0) and a $3 billion offer from two-time owner Kirk Kerkorian has been rejected. Back when MGM was last on the block in 2004, Goldman Sachs handled that deal, too. Sony and Comcast and Providence Equity Partners and TPG paid roughly $5 billion in debt and equity to acquire then publicly traded MGM from its majority owner Kerkorian. Here is Grover's report and below are my own recent MGM posts:
- Now Bond Plays Xmas Release Date Game
- Look What Tom Cruise Made Harry Say...
- Paula Wagner Is DOA At United Artists; But Was It Suicide or Murder By MGM?
- Another Top Executive Exits United Artists
- Hey, Harry Sloan, Show Us MGM's Money
- New Joint Premium TV Channel Venture By Viacom/Paramount/MGM/Lionsgate
- Hey, What's With MGM's Hiring Spree?
- Desperate MGM Studios Throws Hail Mary
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It’s so sad to see MGM kicked around again.
Screw em. If they won’t actually MAKE MOVIES, let em get eaten up. You can’t make money with no product. Crazy business advice, but I was able to come up with it myself. Unless they figure out how to make 10 Bond movies every year, it doesn’t look like this trend is gonna change, either.
Just when you thought the old lion was getting ready to roar again, it ends up playing musical owners, again.
To see such MGM rescued from foreign hands and restored to its rightful place as an American icon would be a glorious event and induce a sense of national pride that should see Old Glory fluttering from every pole in the nation forever. I look forward to that happy announcement.
Bad, bad karma has haunted this place for years, it just attracts the worst of the worst. Is it all about Kerkorian? Can anyone explain?
It’s ironic that at MGM it’s the studio that constantly goes into “turnaround” not the projects.
mgm is currently 4bil overpriced
i think they will sell for 1bil and unfortnuately dismantle company for library.
very sad. another studio gone.
Who wants to buy MGM in this market? In fact, who wants to spend 5 Billion on a film studio that doesn’t actually make films?
I can’t see anyone wanting to buy MGM and run it as an ‘ongoing concern’. Unless Time Warner want to come back in for the studio and simply swallow it whole like Warners did to New Line and reunite the MGM library with the half they aleady own.
But unlike 2004 when WB and Sony were dueling for the studio, 2008 MGM has a whole lot of baggage attached including Crusie’s stake United Artists and all the execs who just re-upped their deals.
Beyond the new Bond movies and half of distribution rights to The Hobbit films, what else is remotely attractive about this studio to make it worth all that money?
CBS Corp could use a movie studio, although maybe not one with as much baggage
kate, the real legacy of Kerkorian’s initial tenure at MGM was the neglect and the eventual shuttering of the studio’s distribution arm in 1973. Once the gold standard of the movie industry, the sales force had less to work with in terms of resources and product in its final years. Even when MGM/UA was revived in the late 70’s, the distribution division was at a serious disadvantage compared to the competition when it came to booking screens (with the exception of the Bond films). If a more stable corporation had come along in the late 60’s and purchased MGM, the studio would be a major force today instead of being the faded entity it has become to the industry.