Metro-Goldwyn-Mayer has taken the first step in a formal sale process, The Wall Street Journal and Variety are reporting today. The historic Hollywood studio has enlisted two investment banks, Morgan Stanley and LionTree LLC, to advise the company as it explores a potential sale.
In addition to the Stargate franchise, MGM owns some 4,000 titles and 17,000 hours of film and television content. That includes the James Bond, Rocky, and The Hobbit film franchises; the Pink Panther; Legally Blonde; RoboCop; and more.
MGM’s current scripted television productions include The Handmaid’s Tale (for Hulu), Vikings (for History Channel), and Fargo (for FX). It also owns the premium cable channel Epix.
PERFECT FOR STREAMING
MGM may be looking at big technology companies (including streamers) like Apple as likely buyers, according to the Wall Street Journal report.
The studio’s extensive library of historic film and television properties make it a goldmine in the new streaming wars. Major media companies that have launched streaming services in recent months are hungry for content, and for existing IP (intellectual property) to turn into new original programming.
Even sweeter is when those existing properties come not only with some name recognition, but also a built-in fan base. That is certainly the case with Stargate, which today spans 26 years, three films, and more than 350 hours of produced television. The universe has an established mythology and fans who have been clamoring for new content since Stargate Universe went off the air in 2011.
Among all of MGM’s dormant holdings, Stargate would seem to be the most ripe for new productions. Add to recognizability and fan demand the fact that the original co-creator of Stargate SG-1, Stargate Atlantis, and SGU has a fourth series in development with MGM. Brad Wright is on board to create a new series right now, satiating fans’ desire for more stories set in the established universe.
The science fiction genre is also in the sweet spot for original streaming content.
Netflix has been handing out cash for original content for years now, while Hulu (majority-owned by Disney) has taken a more curated approach through partnerships with the likes of ABC and FOX. Disney+ benefits from its parent company’s own behemoth library, not the least of which are the Star Wars and Marvel franchises.
But other newcomers — Apple TV+, Warner Media’s HBO Max, and NBC’s Peacock, are more eager for new content acquisitions.
Genre programming is a driving force at Disney+, which recently announced somewhere in the neighborhood of 20 original scripted series … and that’s just in the Marvel and Star Wars universes. CBS All Access is working on around a half-dozen Star Trek shows. And Peacock is looking to Mr. Robot creator Sam Esmail to reboot Battlestar Galactica (again).
Amazon, meanwhile, turned The Expanse from a cancelled cable show to an expanding universe of its own. The sixth and supposedly final season is due out in another year’s time, though the novel writers have every intention of their story returning in some form.
READY TO SELL?
MGM reorganized after filing for bankruptcy in 2010, with its then creditors taking control of operations. The company’s largest shareholder is Anchorage Capital, whose head Kevin Ulrich runs the studio’s board of directors. Some speculate that an eventual sale might have always been the plan. Only the timing is the issue.
MGM’s fiscal year has been severely disrupted by the delay of Bond’s 25th feature outing, No Time to Die. The COVID-19 cinema shutdown forced the film to move from a November 2020 theatrical premiere to next April. MGM is said to have scoffed at Apple’s offer of $350 million to $400 million to buy the rights for a streaming premiere. 2015’s Spectre had earned a worldwide gross of $880 million. Before that, Skyfall brought in $1.1 billion in 2012.
In 2018 MGM ousted its chairman, Spyglass Entertainment founder Gary Barber — reportedly for entering into unsanctioned negotiations with Apple to sell MGM for around $6 billion. The Journal has reported that Ulrich urged investors at the time to stay the course, saying that in another two to three years he could sell the studio for more than $8 billion.
According to trade reports MGM had brief conversations with Apple a year ago about buying the studio.
Today MGM is worth around $5.5 billion, according to Variety. But just as the studio has taken a hit from the pandemic, so has the year of staying home brought a boon to streaming services — and their need for content.
In addition to the rest of MGM’s lucrative film and TV library, the Stargate franchise could provide any of them with an instant science fiction universe to explore.
We’ll continue to monitor the situation and report on the Stargate angle as the story develops. Don’t expect a quick turn-around here: MGM may well wish to wait for No Time to Die to release in the spring, when it can negotiate a sale from a stronger position. And while COVID has made 2020 a rough year for film production and release, studio reps suggested on a recent investor call that MGM may now be poised to have its biggest year for new content in 2021.