You will be redirected back to your article in seconds

MGM will bump its bid for look at Viv U

Studio, other suitors antsy about auction

Kirk Kerkorian’s MGM has raised its bid for Vivendi Universal Entertainment by $300 million — to $11.5 billion — and demanded a reply to its offer by Monday.

Sources close to the process said Lion brass, like execs at other VUE suitors, are increasingly anxious for Vivendi Universal to bring its studio auction to a conclusion. MGM doesn’t expect a complete resolution by Monday, but is seeking at least some specific feedback on where it stands and additional financial data on VUE that wasn’t available during due diligence.

A Universal source said the studio has been loath to provide Lion too much detail on film production and library because of potential competitive conflicts. But U’s resistance could crumble if necessary to keep MGM from bolting the proceedings.

“When a company goes into a process like this, it takes an enormous effort, and it can strangle a company,” an industry exec observed. “It can be a real burden on a company, and that’s why people are seeking some resolution.”

Other bidders for VUE include John Malone’s Liberty Media, General Electric’s NBC and an investment group led by former Viv U vice chairman Edgar Bronfman Jr. An offer by a Marvin Davis-led group was rejected as too low, and Viacom has expressed interest only in select cable assets.

Paris-based execs of Viv U have promised to narrow the field further after concluding a second round of offers, perhaps by mid-August. Unofficially, word also has circulated that Viv U considers $11.5 billion a minimum acceptable offer for its film, TV and theme park operations.

MGM sources claimed Lion has never been informed of any minimum bid, however, and they expressed doubt other suitors had been so instructed.

Initial $11.2 bil bid

It’s believed MGM’s initial bid of $11.2 billion came in higher than other first-round offers and also repped a potentially cleaner transaction. Essentially a cash offer for 100% of the company, the MGM bid compared with others’ offers of cash or cash/stock combos for 70% of VUE.

Lion also said it could buy just 80% of VUE and include some MGM stock, if Viv U preferred.

Lion backers include MGM majority shareholder Kerkorian, Bank of America, Morgan Stanley and Providence Equity Partners. It wasn’t immediately clear which of the bid participants would cough up the extra cash for Lion’s boosted offer.

More Biz

  • Dana Spector Joins CAA

    Dana Spector Joins CAA

    Kirk Kerkorian’s MGM has raised its bid for Vivendi Universal Entertainment by $300 million — to $11.5 billion — and demanded a reply to its offer by Monday. Sources close to the process said Lion brass, like execs at other VUE suitors, are increasingly anxious for Vivendi Universal to bring its studio auction to a […]

  • ALLENTOWN, PA - SEPTEMBER 08: Elton

    Elton John and Universal Music Announce New Multi-Level Agreement

    Kirk Kerkorian’s MGM has raised its bid for Vivendi Universal Entertainment by $300 million — to $11.5 billion — and demanded a reply to its offer by Monday. Sources close to the process said Lion brass, like execs at other VUE suitors, are increasingly anxious for Vivendi Universal to bring its studio auction to a […]

  • Sarah Jessica Parker Gap

    Sarah Jessica Parker Unveils Second Collaboration With Gap

    Kirk Kerkorian’s MGM has raised its bid for Vivendi Universal Entertainment by $300 million — to $11.5 billion — and demanded a reply to its offer by Monday. Sources close to the process said Lion brass, like execs at other VUE suitors, are increasingly anxious for Vivendi Universal to bring its studio auction to a […]

  • Women in Hip-Hop Industry Get the

    Women in Hip-Hop Industry to Get the Spotlight at A3C Conference

    Kirk Kerkorian’s MGM has raised its bid for Vivendi Universal Entertainment by $300 million — to $11.5 billion — and demanded a reply to its offer by Monday. Sources close to the process said Lion brass, like execs at other VUE suitors, are increasingly anxious for Vivendi Universal to bring its studio auction to a […]

  • Streaming Placeholder

    RIAA Issues Bullish Mid-Year Report: Revenue Up 10%, Streaming Now 75% of Total

    Kirk Kerkorian’s MGM has raised its bid for Vivendi Universal Entertainment by $300 million — to $11.5 billion — and demanded a reply to its offer by Monday. Sources close to the process said Lion brass, like execs at other VUE suitors, are increasingly anxious for Vivendi Universal to bring its studio auction to a […]

More From Our Brands

Access exclusive content