2ND UPDATE: MGM has just issued this statement about the results of the creditor voting:
“Metro-Goldwyn-Mayer Inc. (‘MGM’) today announced that the secured lenders voting in the Company’s solicitation process have overwhelmingly approved its proposed plan of reorganization (‘Plan’). MGM will now move expeditiously to implement that Plan, which will dramatically reduce its debt load and put the Company in a strong position to execute its business strategy. MGM is appreciative of the lenders’ support.”
UPDATE: The creditors have now officially approved the restructuring plan that puts the Spyglass chiefs atop MGM and gets the studio moving again. A statement will be released momentarily. Now, the fun begins. If MGM isn’t a distributor, the next installment of James Bond will be a jump ball. Expect Sony (which distributed Casino Royale to battle it out with Warner Bros and Fox, but watch Paramount emerge in the thick of it because of the close relationship that the studio has developed with Spyglass since that company became co-financier of Star Trek and the followup that is in the works.
BREAKING NEWS… Today is judgment day for MGM creditors on whether to vote through a reorganization that would put Spyglass partners Roger Birnbaum and Gary Barber atop a slimmed down MGM that will function as a production company but shed its distribution and marketing units. I’m hearing that the creditors will vote through this plan, probably within the hour. The plan involves a prepackaged bankruptcy and the conversion of $4 billion in crushing debt into equity. I’m not sure this will have the Lion roaring again, but at least there will be an opportunity to make movies again and enhance the value of the library. The place ground to a halt after Mary Parent put together a promising slate of pictures. Cutting distribution and marketing will be an easy way to pare operating costs, as will a move from the opulent Century City headquarters, which cost a fortune. The alternative would have been to embrace an approach by Carl Icahn, who is separately trying to take over Lionsgate. Though Lionsgate brass espoused the benefit of a merger, the lawsuit that the indie filed against Icahn certainly didn’t help his cause. Stay tuned.