Amazon Said to Make $9 Billion Offer for MGM

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variety.com/2021/digital/news/amazon-mgm-acquisition-talks-9-billion-1234975168/




Amazon Said to Make $9 Billion Offer for MGM


Amazon is weeks into negotiations on a deal to acquire MGM for about $9 billion, industry sources tell Variety.

Chatter that Amazon (and other tech giants) have been sniffing around MGM has circulated for some time. But sources indicated that Amazon’s interest in acquiring the studio has taken on a new tenor beyond the usual rumor mill. The deal is said to be orchestrated by Amazon TV chief Mike Hopkins directly with MGM board chairman Kevin Ulrich, whose Anchorage Capital is a major MGM shareholder.

Reps for Amazon and MGM declined to comment.

MGM had already effectively nailed up a “for sale” sign: Variety confirmed in December that the company was looking for a buyer.

News of Amazon’s talks with MGM began to swirl this weekend. The Information reported Monday that Amazon was in talks about a potential deal for MGM, which could run between $7 billion and $10 billion. Industry sources said MGM reps have been whispering to prospective buyers for month about a pricetag of $9 billion while others see it as worth about $5 billion.

In a sign Amazon has upped its focus on entertainment, last week the company announced that it had tapped Jeff Blackburn, a former high-ranking executive who recently exited the ecommerce giant, to return to Amazon in a new role overseeing a consolidated global media and entertainment group.

Amazon currently has more than 200 million Prime members worldwide, and Jeff Bezos recently told investors that 175 million of those streamed Prime Video content in the past year. The company clearly wants to turn Prime Video into an even bigger habit for its customers worldwide — and a quick way to do that would be to add MGM’s library of titles into the mix.

MGM claims to own one of the world’s “deepest libraries” of premium film and TV content.

Its 4,000 film titles include the James Bond, Hobbit, Rocky/Creed, RoboCop and Pink Panther franchises, as well as “The Silence of the Lambs,” “The Magnificent Seven” and “Four Weddings and a Funeral.” The MGM TV library includes approximately 17,000 episodes of programming, including “Stargate SG-1,” “Stargate Atlantis,” “Stargate Universe,” “Vikings,” “Fargo,” “The Handmaid’s Tale,” “Get Shorty,” “Condor,” “Fame,” “American Gladiators,” “Teen Wolf” and “In the Heat of the Night.” Unscripted shows in its portfolio include “The Voice,” “Survivor,” “Shark Tank,” “”The Real Housewives of Beverly Hills” and “The Hills.”

Media is a relatively small piece of the gargantuan Amazonian empire, but it represents a fast-growing business segment. In 2020, the company spent $11 billion on TV shows, movies and music for Prime services — up 40% from the year prior.

For the first three months of 2021, MGM Holdings reported revenue of $403.3 million (up 27% year over year) and net income of $29.3 million (versus a net loss of $12.1 million the year prior).

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deadline.com/2021/05/amazon-mgm-merger-in-talks-1234758795/


Amazon At Altar With MGM?

By Anthony D'Alessandro
May 17, 2021 4:21pm


In the wake of the surprise $43 billion merger between Discovery and AT&T’s WarnerMedia, rumors are racing that Amazon is poised to scoop up MGM in a deal which is reportedly worth under $10 billion.

Much of this coming from a speculative report in The Information. Deadline separately hears from sources that there’s been a weeks of talks between the tech giant and the Hollywood studio that included sales presentations. MGM declined to comment on rumors, and Amazon did not respond. We’re awaiting more intel at the time of this report.

Rumors have been afloat for years that the 007 studio has been up for sale. Days before Christmas last year, a WSJ report surfaced that MGM had tapped Morgan Stanley and LionTree to explore a sale. At the time, rumors were swirling that another tech giant, Apple, was interested in acquiring the studio. MGM had been seeking $10 billion+, a price tag considered too high by a number of potential suitors.

According to sources, speculation intensified late last week that an Amazon-MGM deal was imminent. The announcement of the AT&T-Discovery pact appeared to have slowed the momentum of the talks since so it is unclear whether they will lead to an agreement.

What would Amazon be getting? One of the deepest film libraries, which boasts 177 Oscar wins, 12 Best Picture winners, the James Bond franchise which has grossed over $7 billion in its global B.O. lifetime, and the Rocky and The Creed movies which have together earned more than a $1 billion. There’s also the Epix pay TV network, which MGM took full ownership of in 2017, buying out the stakes of Paramount and Lionsgate. There’s also Emmy winning series such as The Handmaid’s Tale, Fargo, and Survivor among its big TV assets. The rights to the James Bond franchise are owned by EON Prods.

MGM has been a big believer in theatrical, postponing its 007 title No Time to Die, Daniel Craig’s final as James Bond, from Easter 2020 all the way to Oct 8 of this year due to the pandemic. The studio is awaiting for all global markets to be a full go for the film. That said, it did entertain offers from streamers for the pic.

MGM’s financial statements reportedly show $1.496 billion in revenue last year, up from $1.18 billion in 2016.

Former New Line-DreamWorks-Sony executive and Fifty Shades of Grey producer Michael De Luca joined MGM in January last year to turn the studio around, and active it certainly was during the pandemic when several other studios pulled back their activity. MGM acquired such packages as the Ridley Scott-directed Gucci movie that has Lady Gaga playing convicted murderer Patrizia Reggiano, in a film that also has Adam Driver, Jared Leto, Al Pacino, Jack Huston and Reeve Carney. MGM also picked up from Focus in turnaround Paul Thomas Anderson’s next film, as well as the Ron Howard-directed Thai Cave rescue pic Thirteen Lives. They also optioned the Ta-Nehisi Coates novel The Water Dancer with Oprah Winfrey and are working on a Pink Panther reboot and another Creed sequel.

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Amazon Looking To Aquire MGM For $9 Billion

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thestreamable.com/news/amazon-mgm-and-the-future-of-theatrical-distribution


Reports: Amazon Close to Landing Lucrative MGM Deal
MAY 24, 2021, 12:55 PM PDT – Derek Walborn

According to the Wall Street Journal, Amazon is close to a deal to acquire MGM, with Amazon reportedly offering something in the range of $9 billion in exchange for MGM’s 4,000 films and 17,000 hours of television.

While the discussions seemed to closely follow news of the merger of Discovery and AT&T, MGM has apparently been on the auction block for years.

According to the Journal report, an agreement could be announced as early as this week — if talks don’t break down.

The Journal says the deal would be Amazon’s second-largest deal to date, eclipsed only by the $13 billion acquisition of Whole Foods in 2017.

Amazon’s recent offer speaks to the e-commerce giant’s intentions when it comes to continuing to beef up Amazon Prime Video, which by some metrics is already the country’s most popular streaming service.

Access to MGM’s legacy content would obviously be a boon to Amazon. However, it’s a bit less clear to what degree such an agreement might disrupt the studio’s current plans with regard to planned theatrical releases of some of their most popular properties, most notably “No Time To Die.”

Said to be Daniel Craig’s last outing as the titular James Bond, the film has been highly anticipated and continually delayed as studios like MGM have struggled to maintain the status quo of tentpole cinema releases amidst the pandemic, resulting in some creative workarounds.

Disney has opted to stream new releases on its Disney+ platform as $29.99 “premiere access” content. Warner Bros., on the other hand, sent all of their 2021 theatrical releases directly to HBO Max.

Neither studio looks like they intend this strategy to be the new normal.

Disney has expressed a lack of enthusiasm about the prospect of continuing its premiere access feature into 2022, and Warner Bros.’ plans for 2022 are still undefined.


In spite of this, the fact that HBO Max hit the top ten most downloaded apps in 2021’s first quarter thanks to their deal with Warner Bros., it’s clear that there is an appetite among viewers to have top tier theatrical content streamed right into their living rooms.

Reports currently indicate the Amazon’s acquisition of MGM would not disrupt the studio’s 2021 theatrical schedule, although neither company has made any kind of official statement.

007 producers Barbara Broccoli and Michael G. Wilson have explicitly made their intentions known. According to them, “No Time to Die” is coming to the big screen on October 8th.

However, with billions of dollars comes great power. The incentive of exclusive streaming rights to, say, the premiere of a 007 film, might just be tempting enough for Amazon to work some behind-the-scenes magic to give its streaming platform a tremendous shot in the arm. Given that streamers like Apple and Netflix were already provided with the option to license the film but balked at the $600 million price tag, it seems clear that Amazon may just have what it takes to put the world’s most famous secret agent on the country’s most popular streaming platform.

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www.cbr.com/amazon-mgm-buyout-deal-announcement-soon/


REPORT: Amazon's MGM Buyout May Be Announced This Week
Amazon's acquisition of Hollywood giant MGM Holdings may be announced sometime this week, according to internal sources on the matter.

BY JUNIPER TUBBS


Amazon may be close to acquiring longtime film giant MGM Holdings in a buyout that is reported to be announced sometime this week.

According to The Wall Street Journal, those familiar with the matter report Amazon will purchase MGM for nearly $9 billion. The deal has been in talks for quite a while, but a formal process reportedly had not begun until late last year, when investment banks LionTree LLC and Morgan Stanley were hired to oversee the deal. While the two companies have seen on and off discussion on the acquisition over the course of the year, sources suggest the deal has become more serious over the past few weeks.


This would mark the second-largest acquisition from Amazon, which previously purchased Whole Foods in 2017 for $13.7 billion. It would spark a more focused approach from Amazon into the film and TV genres, given MGM's history and large-scale productions, with franchises like The Handmaid's Tale, James Bond and the premium network Epix. MGM is also responsible for classics like Singin' in the Rain, Rocky and The Pink Panther.

With Amazon looking to increase its streaming presence with Prime Video, the deal would give the e-commerce giant a large library of titles to be added to the platform, potentially driving up subscriptions to the video service. The company has continued to invest billions in the service overall, focusing on film, television and live sports entertainment to supplement the services offered. Upcoming projects include the Lord of the Rings TV series and theatrical acquisitions like the Chris Pratt-led The Tomorrow War.


MGM has had a relatively rocky history over the past decade, firing its previous chief executive Gary Barber in 2018 for having private conversations with Apple about a $6 billion acquisition. The company has not had a CEO since then, instead opting for an "office of the CEO" represented by a board of executives across the company. More recently, MGM was the subject of a lawsuit from Starz for violating an exclusive licensing agreement, and 7% of its staff were laid off following Covid-19, with senior management taking pay cuts as well.


While talks on the acquisition are reportedly close to their conclusion, there is still no guarantee that the talks will reach a definitive answer or that they won't be derailed at the last minute. Regardless, according to sources, we may find out the details of the discussion very soon.


Source: The Wall Street Journal