MGM Bankruptcy Makes Headlines

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LOS ANGELES (GaeaTimes.com)- Iconic Hollywood film studio MGM is hogging the limelights for different reasons these days. The studio has applied for Chapter 11 Bankruptcy protection in a Manhattan Court as it has been reported. It has also agreed to think about a possible merger with Lionsgate after it gets over the formalities of bankruptcy. Both the sides were involved in talks for quite a few months. It will also give Carl Icahn its billionaire investor the power to call meetings on special occasions.

Even though MGM owns the largest modern film library of the world, it may not be able to sustain on its own in the long run. The industry insiders are of the opinion that in a few years time the studio will be compelled to merge with entities like Time Warner or Lionsgate. Carl Icahn was trying a few days back to insist fellow MGM debtholders for merging the company with Lionsgate. He has a large stake in it. Besides, he was also trying to stall MGM’s plan to join hands with a partner company named Spyglass Entertainment. He is going to get a seat in the board as well. MGMN on its part is expecting that the Bankruptcy will last for about a month.

MGM has a plan to raise almost $500 million after the bankruptcy is over. Thereafter it will start the production work of long delayed films like the next James Bond flick and The Hobbit. The management of the upcoming entity will be taken over by the Spyglass Entertainment leadership. The news has created sensation in the film industry and producers.