January 19 : 2010
First round of MGM bidding completed
Variety reported on January 18 that the first round of bidding for MGM’s assets is over. It hasn’t been disclosed which companies made bids, but according to the story:
Time Warner, India’s Reliance Entertainment, Lionsgate, AT&T, Liberty Media, Summit Entertainment and News Corp. are among the most likely bidders. More than a dozen companies have signed nondisclosure agreements allowing them to review MGM’s internal financials.
MGM’s assets include the 4,000-title library, the right to make new James Bond and Pink Panther movies, the Lion logo, the United Artists operations and half ownership of the two “Hobbit” movies.
None of the bids apparently topped $2 million, which was MGM’s target figure. The second round of bidding begins next week, with negotiations going on in the interim.
Reliance may seem an odd member of this group, but it’s a wealthy Indian company that has gone in for co-financing Hollywood films, including especially those of Warner Bros.
As I’ve said before, I don’t think the process of extracting MGM from its financial woes will have much impact on the ongoing production of The Hobbit. Whichever company ends up winning the auction, it will be obliged to honor the contract between MGM and Warner Bros. as it currently exists. Warner may well end up being the new owner of MGM’s assets, in which case the production/distribution rights to The Hobbit will be reunited decades after their separation.
(Note: As I’ve mentioned,Variety online recently became subscription only, so I’m no longer supplying links to stories, but I’ll try to quote and summarize the most salient portions in reporting on them.)



