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.

THR: Apple didn’t offer MGM enough for NTTD

Apple Inc. didn’t offer Metro-Goldwyn-Mayer enough to license No Time to Die to show on streaming, The Hollywood Reporter said.

Apple considered an offer of $350 million to $400 million one a one-year license, the entertainment news outlet reported. MGM was looking for $650 million to $700 million or more, THR said.

MGM’s demands were a “nonstarter” for other streaming such as Netflix, according to THR. Meanwhile, MGM — which controls half the Bond film franchise — is incurring $1 million in interest a month for loans to finance the $250 million No Time to Die, THR said.

No Time to Die has had a series of release dates. It had been set to come out in April but was delayed until November because of the COVID-19 pandemic. Now, it’s set to come out in April 2021 but that’s uncertain as the pandemic continues.

Finally, Danjaq LLC — which controls the other half of the Bond franchise — and its Eon Productions unit wasn’t initially told by MGM about the talks. Danjaq/Eon boss Barbara Broccoli opposed the idea, THR said.

Here’s an excerpt from the THR story:

Broccoli is seen as a staunch traditionalist who is very much in support of the theatrical experience. Furthermore, Bond is a franchise connected to luxury and scarcity, and by going to a streamer there could be a brand hit in her eyes, according to one insider. “It’s a dip into a pool you won’t be able to get out of,” says the source.

Bond 25 questions: The streaming edition

No Time to Die poster

What once seemed unthinkable — a new James Bond movie debuting on a streaming service — may be a possibity. Or is it? Naturally, the blog has questions.

How did this come up anyway?

On Thursday, Drew McWeeny, who writes about film, posted a tweet that raised the possibility. He has a reputation for knowing a lot of people in the industry.

I can't get my head around the idea that we may well see James Bond debut on Apple TV+ or Netflix. The numbers I've been hearing the last few days are I N S A N E…

— BooMcScreamy (@DrewMcWeeny) October 22, 2020

McWeeny also publishes a newsletter where he elaborated. Here is an excerpt:

In the last ten days or so, at least six people have reached out to talk to me about what they’re hearing, and it sounds like those two streamers are currently the most actively engaged in conversations with MGM and, I presume, EON and Universal to pick up No Time To Die. I have no idea if other conversations have occurred or not, but I can’t imagine they’re the only two interested parties.

McWeeny also wrote that one figure he’s heard is for more than $600 million. But he also wrote he didn’t know if that was just one film or more.

Separately, the MI6 James Bond website and Bloomberg ran stories on Friday concerning No Time to Die going to streaming first.

MI6 said it “understands that those offers started at $200m are now heading towards $250m – just for the North America streaming rights.”

Bloomberg said Metro-Goldwyn-Mayer has held talks with Apple Inc. and Netflix. The news service cited “people familiar with the situation.” MGM told Bloomberg the film is not for sale. The Bloomberg story doesn’t provide a specific price.

UPDATE (Oct. 24): Variety weighed in with its own story. The entertainment outlet said MGM was looking for a deal in the $600 million range, “a price tag that was deemed too rich” for some of the streaming services. Which ones weren’t specified.

UPDATE II (Oct 24): Dealine: Hollywood (a sister site to Variety) posts a story emphasizing MGM’s denial.

A troll on Facebook (joined in July, only three followers) emphasized to me how Deadline’s Mike Fleming has a special, close relationship to Danjaq/Eon. That’s another way of saying Fleming is an extension of the Danjaq PR machine. Whatever. Personally, I prefer a knowledgeable, independent voice on these things.

What happens now?

The Bond situation is very complicated. MGM and Danjaq LLC jointly control the James Bond film rights. No Time to Die is to be distributed by United Artists Releasing (co-owned by MGM and Annapurna Pictures) in the U.S. and Universal internationally.

That’s a number of parties that may have to be dealt with for any streaming deal.

What’s driving this?

No Time to Die was to have come out in April but was delayed by the novel coronavirus (COVID-19). So it was rescheduled for November. But COVID-19 hasn’t gone away and cases are rising again in the U.S. and Europe. So now, the 25th James Bond film is supposed to be out in April 2021.

What’s more, MGM is a weak studio in an industry already facing changes before COVID-19. The company is owned by hedge funds who likely are anxious to sell the studio.

A streaming deal would deliver cash now while MGM can still be prepare to sell itself later.

But what about that MGM denial to Bloomberg?

That denial may have a short shelf life. Put another way, the denial is true today. The question is how long will it be true?

Apple uses Bond theme to introduce new iPhone

Apple Inc. used The James Bond Theme as part of a presentation to introduce the new iPhone 12 Mini.

Normally, that wouldn’t be much of a deal. However, today’s event comes a couple of days after The Wall Street Journal reported that Metro-Goldwyn-Mayer, Bond’s home studio, is under pressure to strike a sales deal. Apple was listed as one of the potential buyers.

Whether coincidence or conspiracy, it was something Bond fans noted. You can view the use of the Bond theme below via a video from CNET.

Bond 25 questions: The future of MGM edition

No Time to Die poster from spring 2020

It turns out No Time to Die is not just a James Bond movie. It’s also a bargaining chip concerning the future of Metro-Goldwyn-Mayer, Bond’s home studio.

Naturally, the blog has questions.

What’s going on?

MGM is owned by hedge funds. They acquired the studio when it was in bankruptcy in 2010. Hedge funds typically acquire assets and sell (or “flip”) them a few years later at a profit.

MGM’s hedge fund owners have held onto to the studio for a full decade. That’s longer than is typical of hedge funds.

There have been attempts at selling the studio. MGM spent part of 2016 trying to sell itself to a Chinese buyer, according to news reports in early 2017. CEO Gary Barber was in early “unsanctioned” talks to sell MGM to Apple in 2018. That spurred MGM’s board to fire him, The Wall Street Journal said in part of a story about MGM on Oct. 11.

No Time to Die, a $250 million production, was supposed to generate $1 billion in global box office pre COVID-19. That could boost an MGM sales price. But various delays, including two COVID-related ones, have complicated that rosy scenario.

Why should Bond fans care?

The Bond franchise has felt the impact of shaky MGM ownership ever since MGM acquired United Artists in 1981. At times, Eon Production was under the gun to get movies out fast or hold costs down. The whole 1989-1995 hiatus was the direct result of a financial mess at MGM.

Any push by MGM to sell now would be amid the growth in streaming services. Possible buyers may include Apple and Amazon.com, two tech companies active in streaming.

What happens now?

As once said in Diamonds Are Forever, people are playing Monopoly with real buildings, or at least movie and TV studios.

This week’s Wall Street Journal story depicts Anchorage Capital Group, the largest single MGM hedge fund owner, as under pressure to do a deal.

In one passage, the story indicates that Anchorage views the still-unreleased No Time to Die as something that could boost a sales price. A buyer could assume control of No Time to Die’s distribution.

There is a complication, according to the Journal. Comcast Corp.’s Universal is set to distribute No Time to Die internationally. If someone other than Comcast buys MGM, Comcast may need to be compensation.

But I just want my Bond movie! Why do I to follow this other stuff?

Life is complicated sometimes.

MGM is leading media acquisition target, CNBC says

MGM’s Leo the Lion logo

Metro-Goldwyn-Mayer, James Bond’s home studio, is the leading acquisition target among media companies as the industry consolidates, CNBC reported.

MGM “has held preliminary talks” with companies including Apple and Netflix “to gauge their interest,” the financial news network said in an online story. CNBC cited two people familiar with the situation it didn’t identify.

The Wall Street Journal reported last month that Apple held preliminary talks with MGM.

Danjaq, parent company of Eon Productions, and MGM control the Bond film franchise. MGM is owned by a group of hedge funds, which acquired MGM out of a 2010 bankruptcy.

MGM may now be worth $10 billion, CNBC said. Besides Bond, it produces television shows for cable networks and streaming services and owns the Epix premium channel.

Netflix has prompted studios including Walt Disney Co. to start their own streaming services. Apple also has established a streaming service and reportedly is looking to add programming.

THR describes challenges at MGM, Bond’s home studio

MGM’s Leo the Lion logo

Metro-Goldwyn-Mayer faces various challenges that may lead to James Bond’s home studio being sold, The Hollywood Reporter said.

The entertainment news outlet paints a picture of a studio in flux, including possible suitors and executive changes. Among the highlights:

–MGM needs No Time to Die, the upcoming James Bond film to generate $1 billion in global box office. Only 2012’s Skyfall has reached that mark among Bond films.

–Various companies might be interested in acquiring MGM, including Comcast (parent company of Universal, which is handling international distribution for No Time to Die), Viacom (parent company of Paramount) and tech company Apple Inc, which has expanded into streaming television.

“Apple’s fledgling streaming service is far behind Netflix, Amazon, Disney+ and the coming-soon HBO Max and Peacock,” THR said. Apple is sitting on $250 billion in cash and could easily afford an acquisition.

–MGM management is shifting. It was previously known that Jonathan Glickman was departing as head of MGM’s film division. THR reported that former Sony Pictures executive Amy Pascal has joined MGM’s board of directors. Pascal had a close relationship with Barbara Broccoli of Eon Productions when Sony distributed four Bond films from 2006-2015.

–MGM wrote down the value of its Epix premium TV channel by $480 million. MGM bought out its partners for about $1 billion. Translation: MGM paid a lot more for Epix than it was worth. Epix is supposed to be a way for MGM to be consistently profitable.

–MGM is “highly leveraged” (i.e. it has a lot of debt).

MGM became the home studio of Bond when it acquired United Artists in 1981. UA had owned half of the franchise since it bought out Eon co-founder Harry Saltzman in 1975.

Ever since, the MGM-Bond relationship has been a soap opera. Danjaq, Eon’s parent company, filed a lawsuit against MGM, which contributed to the 1989-1995 hiatus. MGM underwent a 2010 bankruptcy, which caused Bond production to grind to a halt for a time.

MGM never replaced CEO Gary Barber after the studio’s board forced out the executive in 2018 MGM currently is managed by an “office of the CEO.”

Apple holds preliminary talks with MGM, Journal reports

Apple logo

Apple Inc. has held preliminary talks about acquiring Metro-Goldwyn-Mayer, the home studio of the James Bond film series, The Wall Street Journal reported.

Most of the story is behind a paywall. However, CET has a summary that can be viewed by CLICKING HERE.

Apple wants is considering “ways to broaden the appeal” of its Apple TV app and $4.99 a month Apple TV + streaming service, the Journal said. In addition to MGM, Apple also had preliminary meetings with the Pac 12 college athletic conference concerning possible programming, the Journal said.

In streaming, Apple is up against various competitors, including Netflix, Disney + and HBO Max. Financial analysts have speculated that Apple needs more programming compared to those competitors.

MGM controls the Bond film franchise, along with Danjaq, parent company of Eon Productions. The company also has a large film library, much of it from the old United Artists, which MGM acquired in 1981. MGM is owned by a group of hedge funds.

MGM has been rebuilding since a bankruptcy in 2010. It has gotten back into film distribution with the formation of the United Artists Releasing joint venture with Annapurna Pictures. MGM also is trying to build other “franchises” such as Creed and the animated Addams Family.

In 2017, The Hollywood Reporter said that Apple and Amazon were looking to get involved with the Bond franchise. At the time, distribution for Bond 25 (now titled No Time to Die) was unsettled. What eventually emerged was United Artists Releasing handling U.S. distribution for No Time to Die, with Universal performing distribution internationally.

The big development since then is the emergence of the streaming competition as studios move to counter Netflix. Walt Disney Co. has been aggressively marketing Disney +, including original programs from its Star Wars and Marvel franchises.

Apple seen as buyer to stock new streaming service (MGM?)

Apple logo

Apple Inc., which is preparing to launch a streaming television service, is seen as looking to buy entertainment companies to get a library of titles for viewing. Metro-Goldwyn-Mayer, James Bond’s home studio, comes up on the list of possibilities.

Earlier this month, Apple said its Apple TV + will go live Nov. 1 and cost $4.99 a month, $2 less than rival Disney +. The problem is Apple doesn’t have the library of titles that Disney has, which includes projects made under the Disney, Lucasfilm and Marvel Studios brands. Marvel, in particular, is making new series for Disney + to go along with its various movie titles. AT&T, which owns Warner Bros., also is getting into streaming television.

Bloomberg and Yahoo Finance had separate stories on Sept. 13 raising the question whether Apple may buy entertainment properties to boost its supply of programming.

Here’s an excerpt from the Bloomberg story (which was picked up by The Washington Post):

Much has been made of Apple TV+ undercutting competitors, but the price was set low to make up for the fact that, unlike rival services, it won’t contain a backlog of content out of the gate. (snip)

Apple’s lack of a library argues for the company to buy a production studio. Lions Gate Entertainment Corp. (which also owns the Starz premium channel), Metro-Goldwyn-Mayer Studios Inc. (known as MGM), Sony Pictures and indie studio A24 are all prospects.

Yahoo Finance interviewed Wedbush analyst Dan Ives.

“It’s a content arms race,” Ives told Yahoo. “Right now, Apple has built a house, they’ve priced it accordingly. They need to fill it with content and we think that’s going to be the next trick up the sleeve for (Apple CEO Tim) Cook in terms of bigger M&A.” That’s mergers and acquisitions for those who don’t converse in business talk.

Ives’s pecking order for potential purchases was as follows: A24 Studio, Lionsgate, Viacom/CBS, Sony Pictures, MGM Studios, Netflix “and then a potential gaming publisher (that could be incorporated into Apple’s streaming service or a separate gaming subscription service) as a wild card.”

Sony distributed the four most recent Bond films. It’s not involved with No Time to Die, which will be distributed by United Artists Releasing (joint venture between MGM and Annapurna) in the U.S. and Universal internationally.

MGM has long been one of the weakest studios, having survived various restructurings and a bankruptcy. MGM controls half of the Bond film franchise along with Danjaq, parent company of Eon Productions. MGM also owns a large film library, which includes the old United Artists library containing such titles (in addition to Bond films) as West Side Story, The Great Escape, The Magnificent Seven, the Rocky series and the Pink Panther series.

Apple certainly has plenty of cash. Interesting times in show biz.