Bond 25 questions: MGM sale (?) edition

No Time to Die logo

Metro Goldwyn Mayer, home studio of James Bond, may be up for sale. This comes as No Time to Die, the 25th James Bond film, still (figuratively) sits on the shelf, unwatched.

Naturally, the blog has questions.

How solid is this news?

It originated with The Wall Street Journal, which cited people familiar with the situation it didn’t identify. The business newspaper initially published a relatively short story early the evening of Dec. 21. Within a couple of hours, the Journal expanded the article. The audio version of the story went from 2 minutes to 6 minutes.

The Journal has published a number of MGM-related stories in recent years, including how MGM spent much of 2016 unsuccessfully negotiating a sale to Chinese investors and an October article about how MGM was under increasing pressure by investors to sell.

How far along are things? If a sale happens, how long will it take?

The Journal reported MGM has retained investment banks Morgan Stanley and LionTree LLC and that a sales process is underway. That suggests things are at an early stage but there’s no way to know for sure. Meanwhile, the sale of an entire company or substantial subsidiary can easily take months.

Why would MGM want to sell?

The studio is owned by hedge funds, led by Anchorage Capital Group. Hedge funds typically own an asset for a few years and then sell at a profit. The hedge fund owners of MGM have held on to the studio for a decade, longer than the norm.

Then, there’s the No Time to Die money pit.

Money pit?

The cost of the 25th James Bond film was approaching $300 million as of June 30, according to a U.K. regulatory filing. Meanwhile the COVID-19 pandemic has delayed No Time to Die’s release twice (April 2020 to November 2020 to April 2021). MGM’s interest costs on its investment are running at a reported $1 million a month.

MGM normally would start to get its money back when the movie went into release. But, besides the delays, theater attendance is way down because of the pandemic.

Who are possible buyers?

The Journal said the studio is looking to non-traditional buyers. Certainly some familiar Hollywood names have their hands tied.

Walt Disney Co. still is digesting its acquisition of 20th Century Fox. The company’s theme park business also was hurt by the pandemic. Warner Bros. is part of AT&T, which is revamping its entertainment assets to build up its new HBO Max streaming service.

Tech company Apple Inc. is a possibility and it needs programming for its own streaming service. But Apple has lots of other ambitions, including getting into car production by 2024, according to Reuters. A deal with Apple isn’t a sure thing.

What does all this mean for the Bond franchise?

MGM and Danjaq LLC control the franchise. An MGM sales means, at the very least, that Danjaq will have to deal with yet another executive regime. Danjaq has had plenty of practice at that since 1981, when United Artists was bought by MGM.

There could be a bigger effect if an MGM buyer had a streaming operation, the way Apple does. Danjaq and its Eon Productions like to make a big movie every so often. Would Danjaq/Eon even be interested in doing streaming series, the way Disney Plus is doing with Marvel and Star Wars?

Hard to say. Barbara Broccoli of Danjaq/Eon said last year she was resisting the idea of spinoffs. Then again, things can change. We might get The Adventures of Bill Tanner or Loelia! as streaming shows.

MGM explores a sale, WSJ reports

MGM’s Leo the Lion logo

Metro Goldwyn Mayer, James Bond’s home studio, is looking into selling itself, The Wall Street Journal reported, citing people familiar with the matter the paper didn’t identify.

MGM has retained investment banks Morgan Stanley and Lion Tree LLC to assist with a sale, according to the financial newspaper.

The studio is looking to its film library, which includes the Bond movies, Rocky films and Pink Panther productions, to generate interest. MGM also has television shows such as Fargo and The Handmaid’s Tale.

MGM and Danjaq LLC, parent firm of Eon Productions, control the Bond franchise.

The studio reportedly spent much of 2016 exploring a sale to Chinese investors before talks broke off late that year. In recent years, MGM has described itself as the leading independent studio in Hollywood.

MGM is owned by hedge funds, led by Anchorage Capital Group. The hedge funds took control after MGM exited from bankruptcy in 2010.

The studio explored selling a one-year lease on No Time to Die, the 25th James Bond film, to streaming service Apple Plus, according to multiple news accounts this fall. The Hollywood Reporter said in October that MGM didn’t consult with Danjaq/Eon, which generated displeasure from boss Barbara Broccoli.

Release of No Time to Die has been held up by the COVID-19 pandemic and the movie currently has an April 2021 release date. The film cost almost $288 million to make as of June 30, according to a U.K. regulatory filing.

Assuming the Journal report is accurate, a new chapter in the troubled MGM-Danjaq relationship may be about to unfold. MGM would provide a lot of programming for streaming services.