Perenchio eyeing share of Lion

Buy would trim Kerkorian's investment

NEW YORK — Broadcasting billionaire Jerry Perenchio is contemplating an investment of roughly 10% of Metro-Goldwyn-Mayer to help MGM’s majority shareholder Kirk Kerkorian trim his 90% stake in the Lion.

Perenchio, who made a fortune as chairman of Spanish-lingo broadcaster Univision Communications, is an old friend of Kerkorian, and the two are believed to have had discussions about Perenchio buying into MGM since Seven Network decided to sell its stake several weeks ago.

Kerkorian ended up buying Seven’s 25% stake at its entry price of $24 a share, or $389 million, increasing Kerkorian’s stake to 90%. But Kerkorian is believed to want to reduce his position to just below 80% to ensure that his private company Tracinda does not have to consolidate MGM for tax purposes.

Sources said an investment by Perenchio in MGM was not certain. But it is possible the mogul — who is about as secretive as Kerkorian and would not respond to a request for comment — will buy the stake as part of MGM’s forthcoming $500 million stock offering.

The 10% of MGM would cost roughly $150 million at the Lion’s current stock price. MGM closed down 18¢ Thursday to $15.31.

MGM declined comment, and a spokesman for Kerkorian’s Tracinda said the company had no knowledge of such a transaction.

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Leave a Reply

No Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More Biz News from Variety

Loading