MGM has tapped two investment banks and started a formal sale process, looking to generate heat from Hollywood studios, international conglomerates, private equity firms and the growing multitude of SPACS, according to the Wall Street Journal citing people familiar with the matter.
The private company has mulled a sale for several years but couldn’t seem to find a fit on price and it’s not clear if it will now. The idea is that its library is of particular valued in an era of streaming video as a crowd of streaming platforms compete for content and viewers. The studio behind James Bond also boasts the Rocky franchise, Silence of the Lambs, The Terminator, The Handmaid’s Tale and Vikings.
MGM declined to comment.
SPACS, special purpose acquisition vehicles, are empty shells put together by bankers and industry experts that raise cash, go public and then merge with private companies — which then become public without having to go through a traditional IPO process. A few SPACS recently have said they are targeting media and entertainment for acquisitions.
The WSJ said the studio has hired Morgan Stanley and LionTree to explore a sale, and that it has a market value of around $5.5 billion, based on privately traded shares and including debt. It has about $2.3 billion in long-term debt.
MGM several years ago held exploratory talks with Apple, about a range of scenarios, from a streaming output deal to a full acquisition. More recently, it talked with the tech giant and other streamers about a one-year license to the latest Bond film, No Time to Die.
In October, Byron Allen’s Allen Media Group acquired MGM’s over-the-air broadcast television networks This TV and Light TV.
MGM’s biggest shareholder is hedge fund Anchorage Capital, whose founder, Kevin Ulrich, is chairman and has been under pressure as other financial investors in the studio seek to cash out.
It came out last month that Ulrich had been sued for sexual battery and assault in a case from June that was settled.
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