Icahn boosts MGM and Lions Gate stakes as he presses for merger
The billionaire investor has increased his stakes in Metro-Goldwyn-Mayer and Lions Gate Entertainment as he continues to seek a merger of the two independent studios.
Since MGM and its roaring lion logo emerged from bankruptcy last December, Icahn has increased his holdings to about 20% from 15%, according to people familiar with the matter who were not authorized to speak about the company's financial details. He has bought the additional stock in private transactions, they said, because MGM's shares aren't publicly traded.
Meanwhile, over the last two weeks Icahn has acquired 756,840 shares in Lions Gate, growing his ownership to 33.2% from 32.6%. Last year, Icahn failed at an attempt to seize control of Lions Gate, whose management he has long criticized for its spending and business strategy.
Though Icahn's precise intentions remain murky, people familiar with the matter say he has continued to urge a merger between Lions Gate and MGM even though attempts last year at such an arrangement failed.
Icahn did not return a call seeking comment, and an MGM spokeswoman and Lions Gate spokesman declined to comment.
Many people in Hollywood have long thought a Lions Gate-MGM merger would make sense. Santa Monica-based Lions Gate, producer of the "Saw" films and "Mad Men," has stronger television and film production businesses, while MGM has a valuable library of about 4,000 titles and international television channels.
But talks last year fell apart over how to value each studio, leading MGM's creditors who controlled the company to put it in bankruptcy and put former Spyglass Entertainment chiefs Gary Barber and Roger Birnbaum in charge.
The two studios are not believed to be in merger talks now.
Meanwhile, Icahn has not signaled an intention to nominate board members or otherwise cause a stir at Lions Gate's Sept. 13 annual meeting like he did last year. But with his growing stake, such a move remains a possibility.
-- Ben Fritz
Photo: MGM and Lions Gate investor Carl Icahn. Credit: Mark Lennihan / Associated Press