A new player — Indian conglomerate Sahara India Pariwar — appears to have entered the long-running MGM ownership drama.
Citing an unnamed source, the Wall Street Journal reported Sunday that Sahara India Pariwar was in exploratory talks about acquiring the hobbled studio for more than $2 billion. The source cautioned the Journal that the talks were at an early stage.
A spokesman for Sahara India Pariwar said the company was in discussions on “mutual interest” with MGM in response to recent reports that it had bid for the studio’s debt. “It’s too early to comment on the issue,” Abhijit Sarkar, head of corporate communications at Sahara India Pariwar, said in an e-mailed statement to Bloomberg News.
MGM had no immediate comment.
The studio’s been silent since last Wednesday, when it revealed that lenders for MGM have agreed to forgive debt payments for the seventh time in a year, giving the storied studio six more weeks of breathing room to restructure. The new expiration date is Oct. 29.
The announcement said the agreement came from 140 lenders who will not seek remedies over the studio’s nonpayment of interest and principal on the company’s bank debt, including the revolving credit facility, until the new deadline.
“The lenders took this action in support of the company’s ongoing efforts to evaluate long-term strategic alternatives to maximize value for its stakeholders,” MGM said. “MGM appreciates the continued support of its lender group throughout this process.”
MGM’s been expected to enter into a pre-packaged bankruptcy and re-emerge between now and the end of October as a debt-free operation. Spyglass toppers Gary Barber and Roger Birnbaum have signed a nonbinding letter of intent to become co-chairmen and co-CEOs of the troubled studio and the two execs had emerged over the past month as the leading candidates to take over management following discussions with MGM’s largest creditors, which include Anchorage Advisers and Highland Capital.
The studio was put up for sale in November but failed to draw bids that were high enough to satisfy the creditors, including a $1.5 billion offer from Time Warner last fall. MGM’s assets include the James Bond franchise and half of “The Hobbit” films, its name and logo, the United Artists operations, a library with more than 4,000 titles and a bare-bones film and TV operation.