Let's hope not -- not before the rest of the vaults are cleared.
Source: Deadline Hollywood
A heated conference call resulted in the knowledge that MGM may be on the brink of bankruptcy.
MGM held a conference call with bondholders who apparently were very irate. The studio begged for money because they had been missing their numbers and were close to being out of money. MGM said they they needed $20 million to cover their overhead and another $150 million on top of that for the rest of the year. This sum would be used to cover upcoming projects, especially a huge one, Peter Jackson's HOBBIT.
The bondholders blamed former CEO Harry Sloane for overpromising then missing the numbers, which was exactly why he was removed from his position. Needless to say, they were not too pleased that Sloane had let the company go down that path. Aside from that fact, they knew that they had to figure out a new plan and move ahead since the company was in trouble.
The main reason for the conference call was for MGM to request for the creditors to waive interest payments on their $3.5 billion dollar debt til February. These guys have some major balls. I understand that it's nothing like the average person asking for money, but still, real balls on those guys. The equity holders say that MGM isn't really worth a lot of money at this point. So the bondholders basically may say to hell with it and decide to not bailout MGM. It would actually benefit them if the studio goes bankrupt because they would be the first to receive any sort of payment.
What's sad (but good for someone else) is that if this happens, someone could come in and buy the company for a decent amount of change. This means that MGM would lose the rights to 007. James Bond is one of their top commodities and they don't think that they could make it without it. Plus they would lose many other franchises as well. There is no final decision as of yet, but this could really go either way. MGM could go bankrupt or they could decide to restructure.
Extra Tidbit: To put my emotions so eloquently: Man that sucks.
|