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MGM gets yet another debt payment extension

Metro-Goldwyn-Mayer Inc.'s lenders agreed to give the struggling studio another forbearance by allowing the company to extend its interest payments until Jan. 31. This is an extension of a deal that MGM cut with its lenders last month that let it forgo such payments on its $3.7-billion debt until Dec. 15.

In a statement, MGM said its lenders gave the extension to support the company's efforts to "develop and evaluate long-term strategic alternatives." The studio said that included "operating as a stand-alone entity, forming strategic partnerships and evaluating a potential sale of the company."

Everyone in Hollywood is betting on the latter and that MGM will officially go on the auction block shortly. And there won't be a shortage of bidders, including Time Warner Inc., News Corp. and Lions Gate Entertainment.

UPDATE (4:49 PM): MGM's invesment bankers, Century City-based Moelis & Co., is overseeing the sales process. After signing non-disclosure agreements, interested buyers will be distributed financial information information about the studio. Happy reading. 

-- Claudia Eller
 
Comments () | Archives (1)

MGM has a long history of being taken over over leveraging it self and then going bankrupt. It reminds me of Bally's gym. How many times can they go up and down? MAybe it would be better for it to just close.


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