Studio confirms plans to 'explore stragetic alternatives'
MGM’s officially for sale.
The Lion said Friday afternoon that it could also find a partner or remain a stand-alone company. In a statement, MGM said it was “beginning a process to explore various strategic alternatives including operating as a standalone entity, forming strategic partnerships and evaluating a potential sale of the company.”
The announcement came following a meeting of MGM debtholders, who also agreed to give the beleaguered studion another month and half of breathing room. The Lion said its lenders had agreed to extend the forbearance on debt payments until Jan. 31 — the second such extension in recent months.
According to sources close to the company, MGM’s investment bankers Moelis & Co. are overseeing the sales process, while current management will remain in place with feature development and production continuing.
MGM’s lenders had agreed previously to let the studio forgo three interest payments until Dec. 15.
“The lenders took this action in support of the company’s ongoing efforts to develop and evaluate long-term strategic alternatives to maximize value for its stakeholders,” MGM said in a statement Friday. “MGM appreciates the continued support of its lender group for the process it is undertaking.”
The announcement came following mounting speculation that MGM was heading toward an auction of assets, which include the 4,000-title library, the logo, the United Artists operations, rights to the James Bond franchise and half-ownership in the upcoming “Hobbit” films. Possible buyers include Time Warner, News Corp. and Lionsgate.
Harry Sloan was replaced as MGM’s CEO this summer by Stephen Cooper, a turnaround specialist who has been charged with restructuring some $3.7 billion in debt.
MGM’s been attempting to rebuild itself as a film producer. In 2009, the studio released only a remake of “Fame”and has three films set for release next year: “Hot Tub Time Machine” in March, “The Zookeeper” in October and a “Red Dawn” remake in November.