MGM to remain independent no longer?
What’s going to happen to MGM?
On Tuesday, the Hollywood studio announced it was replacing its chief executive Harry Sloan with a team that includes a turnaround expert. It’s a well-known fact that MGM, which is owned by private equity firms and Comcast, has struggled with a massive debt load. It has payments due on $3.7 billion of debt and the future isn’t looking too good, given the down market and shrinking DVD demand.
Media and entertainment industry analysts believe MGM won’t last much longer as an independent studio, according to a story in the Los Angeles Times:
Most industry watchers believe that MGM will not survive much longer as an independent studio and is likely to be sold to a bigger media company such as Time Warner Inc. or merged with another movie and TV studio like Lions Gate Entertainment Corp. Qualia Capital, a private investment firm headed by Amir Malin and Ken Schapiro, is actively looking at MGM, said a person with knowledge of the situation.
Who else could be a buyer? There were rumors earlier that investor Carl Icahn, who is a major shareholder in Lions Gate, was buying up MGM’s debt in the open market with the intention of forcing a merger between the two studios.
Then, there’s Comcast, which already owns a stake in MGM and could potentially be interested in owning MGM’s rich content librabry, which includes the James Bond films. Reuters’ Yinka Adegoke recently wrote that investors worry that Comcast will make a splashy acquisition soon. Could this be it?
Keep an eye on:
- Travel Channel bids were due on Tuesday. Who’s going to buy it? (CNBC)
- Virtual cooking is a hit on Facebook. (Los Angeles Times)
- The New York Daily News bumped the Wall Street Journal off most-visited sites list. (Editor & Publisher)
Photo: Actor Daniel Craig. the current James Bond/Reuters