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MGM Meets With Comcast, Apple, Amazon, and Facebook About Potential Merger

Sep 10, 2017
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Wall Street Journal confirms that active conversations have been happening, and that Covid and the delay of Bond threw things in disarray.

In recent months, Mr. Ulrich has said he is working toward a deal and has cited Amazon.com Inc., Apple Inc., Comcast Corp. and Facebook Inc. as possible buyers. He has also said that while MGM’s production business has suffered because of the pandemic, its library of more than 4,000 titles has become more valuable because of the dearth of new content.

A person close to Anchorage said Mr. Ulrich believes MGM is a more-attractive asset because it hasn’t released “No Time to Die,” giving a buyer control over its launch and distribution.

MGM has a deal with Universal Pictures to distribute “No Time to Die” internationally; a new owner would likely need to compensate Universal if it decided to work with another distribution partner, said a person familiar with how the distribution landscape works.

MGM was close to a deal with a Chinese buyer in 2016 for roughly $8 billion, said people familiar with the matter. Mr. Ulrich, a board member at the time, was supportive of the deal, said a person close to him. The deal fell apart as China cracked down on overseas investments, the person said.

In 2018, Mr. Ulrich, by then the board chairman, and others on the board fired Mr. Barber for having early, unsanctioned conversations with Apple to sell the studio for more than $6 billion. The preliminary talks fell apart when he was ousted. Minority shareholders protested, with Owl Creek founder Jeffrey Altman sending a letter to the board saying Owl Creek and other shareholders wanted a deal.

Mr. Ulrich told unhappy investors he could sell the studio for more than $8 billion in two to three years, MGM investors said.

An MGM spokeswoman last week said, “The Apple deal was a rumor.”

Can't say I'm impressed with MGM's arguments about Covid helping its chances, it sounds like Covid killed the marketplace and now they're trying to salvage their value wherever they can. That having been said, MGM under Comcast sounds interesting, although there are big question marks hanging over the whole thing (merchandising for Bond, for example, is owned by Danjaq, not MGM).
 
Comcast has been hit by COVID way more than Amazon, Apple or Facebook and quite frankly, they just don’t have as much money to offer.

I can’t imagine Comcast is a serious player here. I’d assume it would become a fight between Amazon and Apple.
 
Comcast has been hit by COVID way more than Amazon, Apple or Facebook and quite frankly, they just don’t have as much money to offer.

I can’t imagine Comcast is a serious player here. I’d assume it would become a fight between Amazon and Apple.
Comcast took on so much debt in the acquisitions it really does not have the leverage for anything big. Maybe in a few years but it would be foolish to spend big at this time.
 
Comcast took on so much debt in the acquisitions it really does not have the leverage for anything big. Maybe in a few years but it would be foolish to spend big at this time.

Actually, its debt is down to 89b, a fairly substantial reduction. I don't see MGM getting sold for 10b in this climate but if they're desperate - which it sounds like they are - then they're a player.
 
Actually, its debt is down to 89b, a fairly substantial reduction. I don't see MGM getting sold for 10b in this climate but if they're desperate - which it sounds like they are - then they're a player.
James Bond is so big though - and Amazon/Apple are desperate enough for content that will drive subscribers - that Comcast would get blown out of the water in any bidding war.
 
James Bond is so big though - and Amazon/Apple are desperate enough for content that will drive subscribers - that Comcast would get blown out of the water in any bidding war.

I cant imagine James Bond is PC enough for Apple TV. I could see it on Amazon Prime though
 
Aren't all MGM movies pre-1986 owned by Warner Brothers anyway?

Not all. Among others, Orion Pictures and UA libraries are wholly-owned by MGM (so the Rocky Movies, Robocop, Hitchcock's UA films, The Graduate, etc. are all MGM; so are the James Bond movies, though that's part of a weird joint venture). As far as this modern world of constant remakes and sequels goes, Warners hasn't actually gotten much mileage out of their portion of the MGM library. Their last attempt, Shaft, bombed hard; neither the Christmas Story musical 'nor the sequel broke out. Tom and Jerry is a decently sized property but what else? And sure, you got classic movies like the Wizard of Oz and Singing in the Rain, but how much viewership is that actually driving?
 
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I wonder what this means for their joint venture with Annapurna right now. I can't image they wan't to be bought out alongside MGM.
 
Not all. Among others, Orion Pictures and UA libraries are wholly-owned by MGM (so the Rocky Movies, Robocop, Hitchcock's UA films, The Graduate, etc. are all MGM; so are the James Bond movies, though that's part of a weird joint venture). As far as this modern world of constant remakes and sequels goes, Warners hasn't actually gotten much mileage out of their portion of the MGM library. Their last attempt, Shaft, bombed hard; neither the Christmas Story musical 'nor the sequel broke out. Tom and Jerry is a decently sized property but what else? And sure, you got classic movies like the Wizard of Oz and Singing in the Rain, but how much viewership is that actually driving?
Rights may differ for this so sorry if I'm off base, but if you have Wizard of Oz, do they also own theatrical rights to Wicked? If so, Wicked is a billion dollar entity that pre-Covid showed no signs of really stopping. A film could easily be made and make good $$$, when Broadway does return Wicked will be one of the only shows left, so audiences will be forced to choose it assuming audiences return in droves to like theatre, so that is a big catch in my eyes.

Hell, I love Blue Man Group, I know Comcast won't win here, but having a Wicked stage show every night at the resort I think would be a big hit.
 
Rights may differ for this so sorry if I'm off base, but if you have Wizard of Oz, do they also own theatrical rights to Wicked? If so, Wicked is a billion dollar entity that pre-Covid showed no signs of really stopping. A film could easily be made and make good $$$, when Broadway does return Wicked will be one of the only shows left, so audiences will be forced to choose it assuming audiences return in droves to like theatre, so that is a big catch in my eyes.

Hell, I love Blue Man Group, I know Comcast won't win here, but having a Wicked stage show every night at the resort I think would be a big hit.

Nope. The book "Wizard of Oz" is public domain, so anyone can make a movie based on it (that's how Disney was able to make Oz The Great and Powerful in 2013). Aspects that were invented for the MGM film, among them the specific costume and shade of green for the Wicked Witch of the West, are under copyright, but Wicked the musical is based on a book by Gregory Maguire and is actually owned by Universal.
 
Comcast wants the MGM library because they Polygram Library (All the Coen bros films like Fargo etc) was Universal's library before the sell to Vivendi which means Universal gets back underlying rights to certain properties.

Also just want to also point out MGM does not own Bond which makes it even less likely for Apple/Facebook to want.
 
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Comcast wants the MGM library because they Polygram Library (All the Coen bros films like Fargo etc) was Universal's library before the sell to Vivendi which means Universal gets back underlying rights to certain properties.

Also just want to also point out MGM does not own Bond which makes it even less likely for Apple/Facebook to want.

I kinda doubt they'd want to spend the 8b Ulrich is asking for if it's only the underlying rights to Polygram properties?

Bond rights are def complicated and screwy, but I think it's moreso similar to the Hobbit situation, where MGM has exclusive distribution rights and Danjaq owns underlying property + has either approval over or full control of merchandising and theme park rights. Those merch and theme park revenues are a lot more lucrative than just movies and TV shows, so I kinda wonder if anyone would actually go for MGM for the price Anchorage wants without Danjaq.

It's worth noting that MGM was just shopping No Time To Die around for $600M.

They're running out of cash, I wonder how long they can really hold out for a payout. The Apple deal rumored in 2018 was reportedly for 6b, whereas the top shareholder wants to sell for 8b.
 
Comcast wants the MGM library because they Polygram Library (All the Coen bros films like Fargo etc) was Universal's library before the sell to Vivendi which means Universal gets back underlying rights to certain properties.

Also just want to also point out MGM does not own Bond which makes it even less likely for Apple/Facebook to want.
How many franchises can be mined out of the MGM library? I'm not sure if they're pretty worth premium dollar like $8 billion.

Rocky via Creed is doing well, I'm sure there can be a good new reimaging of Robocop in our current technology/police political situation, James Bond isn't solely theirs, Pink Panther tried a reboot and did 2 movies. Legally Blonde is on their franchise list but their last movie for that was a spin off in 2009 I never heard of (The title? Legally Blondes). Outside of digging into the really old stuff I just don't see the huge value.

It's worth noting that MGM was just shopping No Time To Die around for $600M.
Basically they're saying the movie should be making 1.2 billionish if it went normal theatrical. Basically they'd beat their previous record held by Skyfall of $1.1 billion by a hundred million or so. That almost seems reasonable.
 
How many franchises can be mined out of the MGM library? I'm not sure if they're pretty worth premium dollar like $8 billion.

Rocky via Creed is doing well, I'm sure there can be a good new reimaging of Robocop in our current technology/police political situation, James Bond isn't solely theirs, Pink Panther tried a reboot and did 2 movies. Legally Blonde is on their franchise list but their last movie for that was a spin off in 2009 I never heard of (The title? Legally Blondes). Outside of digging into the really old stuff I just don't see the huge value.

Look beyond the film library. Hannibal is still quite popular as well though if you go through the film library.

The television unit is responsible for some on the most popular unscripted programming including some of NBC/Bravo top tier unscripted shows (The Voice, Real Housewives, and more). That alone adds value to Universal in terms of after purchasing they would be buying internally which lowers costs in the long term.
 
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Generally speaking, every company suffered during COVID-19 and lost a lot of money. Of course, all of them try to fight to gain back their loss. For example, my parents have felt this feeling on themselves. On top of that, a huge mistake lots of companies have made is that they didn't promote their companies in the right way. After I made some researches for them, I found famoid and who are here to change all bad thoughts about social media services and to improve them. I think Apple and Amazon are fighting to gain back their community.
 
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