A report late yesterday says Amazon in talks to buy MGM. The report we used came from Variety. Though, to be fair they were not alone with this news, with other trades and various outlets reporting the same information. Variety‘s sources tell them Amazon is several weeks into negotiations to purchase MGM. The price is said to be around the $9 billion mark.
As you’d imagine, especially for legal reason nether MGM nor Amazon were willing to comment. However we have known for some time that MGM essentially had a for sale sign out front. There have been several interested parties sniffing around but now Amazon has taken that one step further. The deal is said to be being orchestrated by Mike Hopkins, senior VP of Amazon Studios and Prime Video, directly with MGM board chairman Kevin Ulrich, whose Anchorage Capital is a major MGM shareholder.
Industry insiders have told the trade that MGM are looking for £9 billion. However, the value could actually be closer to $5 billion when all is said and done. One assumes there will be a compromise somewhere in the middle. After all, what’s a billion here and there to these titans?
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MGM’s big attraction seems on the surface to be it’s back catalogue. This catalogue includes the likes of James Bond, The Hobbit, Rocky, Robocop and many more. However in a world where studios are rebooting of franchises right left and center, I do find Stargate as an intriguing ‘get’ for Amazon. A modern reboot of the Stargate franchise carrying on from the old shows with a bigger budget would definitely get me to sign up for Amazon. Ok, I already do subscribe to Amazon Prime, but you know what I mean. That’s only one of several popular TV franchises or unscripted shows that MGM currently own.
MGM isn’t big enough to launch their own service with serious investment and frankly that’s too much of a risk. Better to sell up to an already established streaming giant and reward your shareholders with a nice pay off. Only this week we’ve seen big plans for AT&T to merge with Discovery. Ultimately even with HBO Max on the go, the amount of investment required to catch up with Netflix, Amazon and Disney+ is staggering. We are therefore in a new era. An era where that will end with three or four companies owning all the movie and TV business between them.
How long before Sony sells up their studio rights, as it’s the part of Sony’s business which makes least money for their shareholders? Will Paramount have to join with someone else in order to get their Paramount + project anywhere near as competitive as the current big three? Watch this space, but the landscape is changing.
What are your thoughts on the reports of Amazon in talks to buy MGM? As always, any thoughts, leave them below.
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