- Associated Press - Wednesday, July 14, 2010

LOS ANGELES (AP) - Struggling movie studio Metro-Goldwyn-Mayer Inc. said Wednesday that it has gotten another agreement from its creditors to delay taking action for its failure to make payments on its debt as it seeks a financial savior.

This time, the agreement to put off pushing the company into bankruptcy will last until Sept. 15, nearly a year since creditors first agreed to the waivers.

“The lenders took this action in support of the company’s ongoing efforts to evaluate long-term strategic alternatives to maximize value for its stakeholders,” the studio said in a statement.

MGM, which owns half the rights to the upcoming “The Hobbit” movies, and helps make James Bond movies, owes about $4 billion to around 140 creditors, including JPMorgan Chase & Co. and hedge fund Anchorage Advisors LLC.

The agreement comes a day after rival Lions Gate Entertainment Corp. reportedly made a new proposal to the studio to merge their operations.

Lions Gate aborted an earlier offer for MGM, but renewed its interest after it agreed on Friday with its main shareholder, Carl Icahn, to temporarily halt their fighting for 10 days and work together on acquisitions.

Lions Gate’s proposal is currently competing with separate offers from production and finance company Spyglass Entertainment and from Summit Entertainment, the backer of the hugely popular “Twilight” movies.

Underlining those proposals is the $1.5 billion all-cash offer from Time Warner Inc.

Time Warner’s bid would give creditors the ability to recoup less than half of the face value of debt they are owed, but unlike the other offers, not give creditors any ownership in the new company.

The wrangling over the fate of the troubled studio has thrown a wrench into its plans to make new movies.

This spring, director Guillermo del Toro had to resign from “The Hobbit” due to production delays, while producers Michael G. Wilson and Barbara Broccoli said work on the next James Bond movie had been halted indefinitely because of uncertainty about MGM’s future.

Copyright © 2018 The Washington Times, LLC.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide