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Metro-Goldwyn-Mayer Inc. has filed for Chapter 11 bankruptcy in Manhattan Federal Court after rejecting a takeover bid by Lionsgate and billionaire Carl Icahn. It is expected that the “pre-pack” bankruptcy deal will last 30 days with major lenders JP Morgan and Credit Suisse swapping $4 billion of loans for a majority of the company’s equity.
MGM has been in financial stances for a long time, with only the Bond series being successful. Other recent films have been commercial and critical disappointments.
The preferred buyer for the beleaguered studio is Spyglass Entertainment, a respectable company who has a produced many quality of films such as The Sixth Sense, Star Trek, Invictus and Seabiscuit. James Bond and MGM’s back catalogue includes the Rocky series, 2001: A Space Odyssey and The Wizard of Oz.
Despite all the troubles MGM is suffering, they promise there is enough cash for the day-to-day running of company. The Hobbit is now finally in pre-production after years of delays, with MGM looking for third party assistance to raise it share of the funds and it has been announced that Bond 23 is scheduled for a November 2012 release: so Bond and Tolkien fans like myself will be happy. MGM hope to raise $500 Million dollars for operations (i.e. film and television production) after the 30 days of bankruptcy.