NEW YORK — Kirk Kerkorian’s Tracinda Corp. said Tuesday it “has not had any discussions with Seagram Co. or any of its subsidiaries regarding a possible business combination,” putting to rest any lingering speculation that Seagram and Kerkorian were negotiating a merger of Kerkorian’s Metro-Goldwyn-Mayer with Polygram Filmed Entertainment.
Seagram is shortly to complete its acquisition of PFE’s parent, Polygram Holdings, and has been trying to sell PFE. But none of the three bids it received 10 days ago were particularly attractive, sources said.
Wall Streeters said late last week that Seagram may have to consider some innovative solution, such as retaining an interest in PFE by merging it into MGM in a stock-swap. Formulations of that idea are believed to have been pitched to Seagram but did not appear to go anywhere.
A spokesman for MGM said the Lion had not discussed merging with PFE (Daily Variety, 9/28), although observers say Kerkorian has been known to negotiate deals without telling his own execs. Tracinda’s statement appeared to rule out even that possibility, however.
Meanwhile, Seagram and its advisors continue to review the bids that have been received as well as weighing the costs of absorbing PFE into Universal Studios, sources said.
Seagram is expected to go back to some of the bidders seeking more specific price information. Both Carlton Communications and MGM bid only for the 1,500-title film library, offering $300-400 million in cash, while the alliance between Canal Plus and Artisan Entertainment bid for the entire company with an offer of $400 million plus assumption of $300 million in debt.
The Canal Plus-Artisan offer is believed to be complicated and observers say Seagram may decide to accept one of the library-only offers and absorb the rest of PFE into Universal.
Tom Rosenberg’s Lakeshore Entertainment continues to hover at the edge of the situation. It did not submit a bid by the deadline, telling Seagram’s advisors it needed more time to complete due diligence, so it is conceivable Seagram will invite Lakeshore back into the bidding if it is unhappy with the offers received so far.