MGM Emerges from Bankruptcy20 Dec, 2010 By: Chris Tribbey
Metro-Goldwyn-Mayer Inc. emerged from bankruptcy protection Dec. 20, making effective a reorganization approved by the U.S. Bankruptcy Court in New York Dec. 2.
The famed studio retained JPMorgan Chase to arrange $500 million in financing to fund operations, including production of a new slate of films and TV series, and exchanged nearly $5 billion in long-term debt for majority equity in the company, which will be led by MGM Inc. co-chairmen and CEOs Gary Barber and Roger Birnbaum.
“MGM is emerging from one of the most challenging periods of its storied history,” the two said in a statement. “We are honored and inspired at the opportunity of leading one of Hollywood’s most iconic studios into its next generation of unforgettable filmmaking, global television production and distribution, and aggressively pursuing, developing and exploiting new digital entertainment platforms.
“Beginning today, MGM is a stronger, more competitive company, with a solid financial foundation and a bright future,” the statement read. “We look forward to working with MGM’s dedicated employees to build upon this company’s legacy.”
Lionsgate had been seeking a merger with the studio as late as Nov. 10.
“If we can come up with the right transaction, making it an accretive transaction for our shareholders, [then] we would absolutely embrace that idea,” Michael Burns, vice chairman of the Santa Monica, Calif.-based minimajor, told CNBC. “We are very interested in the MGM transaction.”
Lionsgate shareholder Carl Icahn owns a significant stake in MGM as well.