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