Well, the sale of MGM just got a lot more interesting. I already know that Warner Bros, Lionsgate, Spyglass Entertainment, and others have put in first-round bids for the movie studio during this prolonged sales process. But now there are two fresh offers that would keep MGM independent and functioning.
I’ve confirmed news reports saying News Corp this week sent a letter to MGM with a non-binding offer of cash and debt assistance to the studio teetering on the brink of bankruptcy because of the $3.7 billion it owes. This came after News Corp finally agreed on January 15th to sign a tweaked Non-Disclosure Agreement allowing it to view MGM’s financials. It’s well known that 20th Century Fox would love to get its hands on James Bond movies whose DVDs it already distributes as part of its home entertainment deal with MGM.
Meanwhile, a separate offer from the media investment firm Qualia Capital LLC consists of “$500 million to fund operations as part of a plan that also seeks to convert some debt to equity, according to a another person with knowledge of the situation,” Bloomberg is reporting. “In return, Qualia would receive an equity stake in MGM, said the person, who wasn’t authorized to speak publicly.”
Meanwhile the clock keeps ticking down MGM’s future: it’s deadline to pay interest on its debt was recently extended yet again to March 31 to give the movie studio time to restructure or find a buyer. This is turning into a real cliffhanger.