Yesterday, a large conference call took place between MGM executives and bondholders in which the former “made a desperate plea for money because the studio had missed its numbers and was going to be out of funds very soon.”
That’s right, ladies and gentlemen, MGM may be on the verge of bankruptcy — at least, that’s what an initial glance at this plea seems to indicate. Metro-Goldwyn-Mayer, producer and distributor behind The Hobbit, the James Bond film franchise and the upcoming Fame and The Cabin in the Woods (along with a large catalog of classics), is said by a source to need “an additional $150 million to get through the end of year and continue funding its projects, and to start Peter Jackson’s Hobbit.”
The only semi-productive avenue for the bondholders seemed to be allowing MGM to slip into bankruptcy and collecting their funds, which would essentially (amongst other disastrous consequences) deprive MGM of the 007 franchise and The Hobbit, along with many other tentpole franchises they own the rights to.
This would be a crippling blow to both MGM and fans — the next entry in the Daniel Craig series of James Bond films is a highly-awaited blockbuster, while The Hobbit has a built-in fan base the likes of which few properties hold. Without these two alone, MGM might as well fade into dust.
For now, MGM is in the process of “formally asking for forbearance,” which will delay this gloom and doom scenario while MGM restructures itself. Fingers crossed that they get their act together, without the repercussions of bankruptcy.
More updates as this situation unfolds.
[...] week or so ago we reported on the financial crisis facing Metro Goldwyn Mayer that threatened to knock Guillermo Del Toro’s The Hobbit off its [...]
[...] long ago, we told you about MGM’s impending financial crisis which threatened the life of the company, as well as the franchises that MGM holds. It seems that [...]