Forbes reports MGM has held exploratory talks with Amazon about a sale but hopes of $10 billion price tag are fading.
A few days before Christmas we reported that MGM had begun the process of actively seeking a buyer after recruiting advisors Morgan Stanley and LionTree LLC.
It came after the studio’s biggest shareholder, New York hedge fund Anchorage Capital Group, came under pressure to sell the studio after No Time to Die was postponed for a second time due to the covid-19 pandemic in October.
Now Forbes reports that Anchorage’s boss, Kevin Ulrich, is hoping for as much as $10 billion. It also says that LA-based investment banker Lloyd Greif values MGM at as much as $9 billion. But that value is reliant on rival streaming services getting involved in a bidding war.
Forbes says that Mike Hopkins, senior vice president of Amazon Prime Video and Amazon Studios, is reported to have held exploratory talks, as is Eagle Equity Partners, part owned by former MGM CEO Harry Sloan.
However, the thoughts of selling MGM for $10 billion are said to be fading fast. As one movie insider put it, “Oh please, it’s been for sale for 100 years”.
So how might this affect No Time to Die?
MGM tried to sell exclusive year-long streaming rights to the film with an asking price of in excess of $600 million. That move was made without the knowledge of Eon Productions and Barbara Broccoli was said to be furious when she found out. She remains adamant that No Time to Die will be released on the big screen.
Both positions are understandable. MGM paid for the production and wants to see a return on investment while it reportedly racks up $1 million per month in interest charges. The producers believe the film should be seen in the environment for which it was designed and would prefer to hold out for as long as it takes.
But any new owner for MGM could put a spanner in the works as far as Eon’s plans go. That is particularly true if that new owner was a streaming service although may depend on Eon’s contract with MGM.
And there is also a risk in holding out for a theatrical release. While the end of this pandemic may be in sight thanks to a number of vaccines, no one knows for sure how quickly the wider cinema-going public will return to cinemas. And how many cinemas will still be open when this is all over?
There are people who have continued to see films on the big screen throughout the pandemic while cinemas have been open. But many people have not and both Cineworld and AMC had to seek additional funding to keep them going for the foreseeable future. AMC had previously stated that they may not make it through the winter. And what about smaller operators?
As is so often the case with MGM we (and Eon) must wait and see how it pans out.