Will MGM Studios survive COVID-19? Look inside their money woes
MGM, one of the oldest film studios in the world, is selling itself. As of now, MGM has recruited Morgan Stanley & LionTree LLC to further advise the studio about how it should sell its major titles.
Right now, MGM’s net worth surpasses $5 billion. The film studio hopes to get a good price for their full catalog which is over 4,000 titles strong and includes classic films & successful TV shows.
MGM’s sale suggests the studio wasn’t able to maintain itself during the pandemic. With several delays in their upcoming films’ release dates, MGM’s struggling to make ends meet. Here’s what we know about MGM’s decision to sell themselves.
Back in 2010, MGM notoriously faced bankruptcy but recovered under Gary Barber’s watch. However, eight years later, Barber was abruptly let go due to differences in management. The former CEO had successfully helped MGM recover from the 2010 crisis, which is why his termination came as a surprise to everyone.
Apparently, Gary Barber didn’t see eye to eye with MGM’s board of directors chair Kevin Ulrich. One of the main disagreements was that Barber was willing to sell MGM, but Ulrich wasn’t. This is mainly because Ulrich’s firm Anchorage Capital Group is the largest owner of MGM. It was also reported that Barber micro-managing style wasn’t widely appreciated.
After leaving, Barber teamed up with Lantern Entertainment to relaunch Spyglass Media Group which he co-founded in 1998. Last year, Lantern purchased Weinstein Co. and we can probably expect some (hopefully unproblematic) remakes to be made soon. Combined with Barber’s plan to focus on streaming platforms, it’s likely we’re going to witness a major comeback from Spyglass.
This year, MGM announced the release of the new James Bond film, No Time To Die, would be pushed back to April 2021. The decision to delay the film’s premiere seemed to come from the COVID-19 crisis.
No Time To Die alone cost the film studio millions of dollars in defunct advertising as they had to postpone the premiere twice already – meaning the release dates shown in their publicity campaigns had to be redone and new promotional materials had to be rolled out.
The delay of the new James Bond movie cost the film studio over $50 million, but the loss is reportedly less than expected had they released the film on schedule.
Although the possibility of releasing No Time To Die directly on a streaming platform was considered, MGM never reached an agreement. So far, it seems like the new James Bond movie is still expected to be released in theaters next year. With five productions being shot during the pandemic, and four rescheduled to be released in 2021, MGM seems to have had a rough year.
While an official offer is still pending, it’s been speculated that some of MGM’s potential buyers include Amazon.com Inc., Apple Inc., Facebook Inc., and Comcast Corp. Whoever the buyer is, any of these companies will have the chance to remake MGM’s titles which would probably raise the public’s interest and result in considerable revenue.
MGM’s main selling point is its extensive library which includes franchises such as Rocky, James Bond, RoboCop, and The Hobbit, as well as huge TV shows like The Handmaid’s Tale, Stargate, and Vikings.
In addition to their released titles, MGM also owns the rights to upcoming projects which include the film Gucci starring Lady Gaga, another Creed movie, the sequel of Legally Blonde, a Tomb Raider film starring Alicia Vikander, and a musical starring Peter Dinklage, among others.
Which studio is most likely to acquire MGM? Tell us what you think in the comments!