007 questions about how the MGM-Spyglass deal affects James Bond

We may not be able to provide the answers but we’re good at asking questions about James Bond. Here’s our special MGM financial restructuring edition.

001. How long will MGM be in bankruptcy court? Metro-Goldwyn-Mayer Inc. is going to file for bankruptcy as part of a plan that MGM creditors approved on Oct. 29. The filing will be what’s known as a “prepackaged” bankruptcy, meaning creditors are agreed on terms ahead of time to try to minimize time in bankruptcy court.

The Wall Street Journal, in a story about the vote by MGM creditors, said the studio might get out of bankruptcy court in “a month or two.” The Los Angeles Times said it might be as little as one month.

If these reports are correct, MGM would get out of bankruptcy court in December or early 2011. But given the twists and turns in the MGM financial saga, you might avoid betting on a specific date.

002. But Bond 23 will get back on track pretty soon, right? That depends on your definition of soon.

003. Once MGM gets through bankruptcy court, what else might hold up Bond 23?

For one thing, the revamped MGM will be smaller and no longer release films itself. MGM, which controls half of the 007 film franchise, will be run by Gary Barber and Roger Birnbaum, the co-founders of Spyglass Entertainment. The duo will have to cut deals with other studios to release films. There’s a lot of change ahead at the studio.

Meanwhile, there have been signs that Eon Productions, the other half of the Bond film franchise, didn’t exactly move quickly on Bond 23, even before it said in April development of the film was suspended indefinitely because of MGM’s financial ills. The production company issued a press release last year about how Peter Morgan, writer of Very Important Films such as Frost/Nixon, would help do Bond 23’s script. Morgan has disclosed he never got past the treatment stage while questioning the basic Bond concept. That raises the question whether Eon wasted its time before MGM’s situation worsened.

004. Can the revamped MGM properly finance a Bond movie? 2008’s Quantum of Solace, released by Sony’s Columbia Pictures, had a reported budget of $230 million. MGM’s business plan calls mostly for much-more modestly budgeted projects with occasional big projects. Presumably, Bond 23 would be one of those. The actual budget may depend on what studio ends up doing a deal with MGM to release Bond 23.

005. Does (and should) 007 face some budget tightening? Chances are unlikely Bond 23 would be a bargain basement production but it remains to be seen whether it’s as pricey as Quantum of Solace. A somewhat less expensive Bond 23 might not be a bad thing; Quantum, despite its ample budget, was seen by many fans as not being as good as the previous 007 film, Casino Royale. A major unknown is what studio actually ends up releasing Bond 23 and the terms of its deal with MGM.

006. What studio will release Bond 23? According to Mike Fleming of Nikki Finke’s Deadline.com Web site, there will be a lot of interest among major studios:

If MGM isn’t a distributor, the next installment of James Bond will be a jump ball. Expect Sony (which distributed Casino Royale) to battle it out with Warner Bros and Fox, but watch Paramount emerge in the thick of it because of the close relationship that the studio has developed with Spyglass since that company became co-financier of Star Trek and the followup that is in the works.

007. Is the MGM creditor vote good news or not for Bond fans? Assuming MGM gets out of bankruptcy court quickly, it’s a positive step — but it doesn’t appear to jump start Bond 23 by itself. The Spyglass deal is complicated and was arrived at only after MGM couldn’t sell itself at a price debt holders wanted. The new MGM management team’s job is just starting. We also don’t know what kind of relationship the new regime will have with Eon boss people Michael G. Wilson and Barbara Broccoli.

MGM watch: It ain’t over till it’s over

The fate of Metro-Goldwyn-Mayer Inc., which controls half of the 007 franchise, remains unsettled as one Indian company and a well known corporate investor figuratively kick the tires.

First, from a Sept. 19 Bloomberg.com story about Sahara India Pariwar:

Sahara India Pariwar is in discussions on “mutual interest” with Metro-Goldwyn-Mayer Inc., a spokesman for the Indian company said in response to reports that it had bid for the studio’s debt.

“It’s too early to comment on the issue,” Abhijit Sarkar, head of corporate communications at Sahara India Pariwar, said in an e-mailed statement today. He didn’t give details.

You can read the full story BY CLICKING HERE. Two days earlier, the Associated Press had a story a version of which YOU CAN READ BY CLICKING THIS LINK. The story began like this:

LOS ANGELES (AP) – Sahara India Pariwar, an Indian conglomerate with real estate and media holdings, says it has made a $2 billion bid to buy the debt of struggling Hollywood studio Metro-Goldwyn-Mayer Inc.

It was unclear how MGM’s committee of creditors views the offer. A spokeswoman for the studio declined to comment.

All of this comes when Spyglass Entertainment has been reported by various media outlets as having a tenative to take control of MGM THAT WOULD INVOLVE MGM MAKING A “PREPACKED” BANKRUPTCY FILING. So far, there has been no official announcement from MGM, other than a Sept. 15 statement that the studio got another extension on making debt payments.

But that’s not the only potential complication. On Sept. 17, THE LOS ANGELES TIMES REPORTED THAT INVESTOR CARL ICAHN WAS BUYING UP MGM DEBT.

Here’s an excerpt:

Icahn previously accumulated and then sold debt in MGM earlier this year. In the past few weeks he has acquired what one person close to the situation described as a single-digit percentage in the studio’s nearly $4 billion worth of debt.

There’s no indication that Icahn wants to play a role in MGM if the company goes ahead with current plans for the top executives of Spyglass Entertainment to take over following a pre-packaged bankruptcy. The investor may just believe he can make a profit given the current trading price of the company’s bonds.

We don’t know precisely what all this means other than MGM’s fate, along with that of the cinematic James Bond, isn’t settled. Don’t make plans for attending the premier of Bond 23 yet.

MGM watch: studio gets another debt extension, Reuters says

Metro-Goldwyn-Mayer Inc. said today in an e-mailed press release it got another extension for repaying its debt, this one lasting until Oct. 29. Here’s the start of a STORY BY REUTERS that reported the news:

Metro-Goldwyn-Mayer [MGMYR.UL] said on Wednesday that its lenders agreed to extend a deadline for debt payments as the film studio prepares to be handed over to film company Spyglass Entertainment.

A source familar with the matter said last week that the founders of Spyglass signed a nonbinding letter of intent to take over MGM, which is struggling with about $4 billion of debt after being bought out in 2005.

Nothing new about the possible Spyglass deal in today’s announcement, much less whether (as fans hope), it will get Bond 23 out of its current state of limbo.

UPDATE: Nikki Finke weighs in on her Deadline site which YOU CAN VIEW BY CLICKING HERE. She sounds as tired of these debt extensions as most Bond fans.

Dueling Reports: Hollywood Reporter says MGM’s bankruptcy chances increasing; WSJ says Spyglass near MGM deal

Aug. 10 ended up having dueling reports about the future of Metro-Goldwyn-Mayer, James Bond’s home studio, which also controls half of the 007 franchise. The day started off on a gloomy note when The Hollywood Reporter, in a story by Carl DiOrio, analyzed whether MGM may have to declare bankruptcy. Here’s the beginning:

Things are going so badly with MGM’s restructuring review that a forced bankruptcy is a real possibility by Sept. 15….(snip) little more than a month before $400 million-plus in owed debt and interest payments come due, this much is certain: Frustration has never been higher with the more than yearlong effort to heal the ailing Lion.

“It’s kind of become a joke,” said an exec at one of the companies considering a strategic partnership with MGM. “There is a real fatigue among the lenders after all of the forbearance agreements.”

The story, WHICH YOU CAN VIEW BY CLICKING HERE, is more analytical and didn’t break a lot of hard news. But the story indicated that MGM’s hold on the James Bond franchise may have a big impact on how all this turns out.

As for the fear of losing control of 007 rights, there is no legal consensus on whether lenders would lose those rights in the event of a forced bankruptcy. But such concern has been enough to force lenders to agree to the half-dozen debt payment extensions.

That refers to the number of times creditors have extended deadlines for getting repaid money they’re owed. The current extension expires on Sept. 15. It’s doubtful that Bond fans, forced to endure an indefinite delay of Bond 23, will find very much to be satisified about.

Late in the afternoon, The Wall Street Journal reported that Spyglass Entertainment IS NEAR A DEAL TO RUN MGM. Here’s an excerpt. The “they” in the following paragraph are referred to as people familiar with the matter in the story’s first paragraph.

MGM’s creditors have hammered out financial details with Spyglass co-heads Gary Barber and Roger Birnbaum and the two sides have spent the better part of this week negotiating the makeup of MGM’s new board, they said.

The story says a “streamlined” bankruptcy would be involved before Spyglass would oversee MGM. The WSJ REPORTED BACK IN JUNE that Spyglass was the leading contender to take control of MGM.

UPDATE: Bloomberg.com, in a story by Ronald Grover THAT YOU CAN READ BY CLICKING HERE, has additional details. An exerpt:

Spyglass, led by filmmakers Gary Barber and Roger Birnbaum, would receive 4 percent ownership in MGM in return for their rights to films including “Sixth Sense” and “Seabiscuit,” said one of the people, who declined to be identified because the discussions are private.

An accord, which could be announced in days, would involve a bankruptcy filing to convert the debt into a more than 90 percent stake in MGM, said one person. Los Angeles-based MGM has two releases for 2010, according to Box Office Mojo. Spyglass, which is being advised by Deutsche Bank, would need to raise as much as $500 million for production, the person said.

Among the films MGM has on its schedule further out are a James Bond feature and a two-picture installment of “The Hobbit,” a prequel to the blockbuster “Lord of the Rings” series. MGM has the rights to “The Hobbit” with Time Warner Inc.’s Warner Bros.

007 questions related to being a James Bond fan

001. Do we know any more about Bond 23 than we did three months ago? Not really. Eon Productions co-boss Michael G. Wilson has been quoted as saying a new film might occur “soon,” but he provided no dates, no details. In the space of three months, Eon said work was suspended indefinitely, a U.K. newspaper called the project “cancelled” and Metro-Goldwyn-Mayer Inc. has gotten extensions on making debt payments and remains a Hollywood pauper.

002. Should I be pessimstic or optimistic? Until MGM’s situation is more clear, it’s hard to be optimistic. MGM, which controls half the Bond franchise, supplies the cash from which everything else happens. But some fans go the other way and say it may be a decade before the next movie comes out. For now, that sounds extreme, but who really knows?

003. What do James Bond experts say? Depends on the expert and how much he/she really knows. There’s a lot of heat and not much light right now.

004. How do I pass the time and still engage my passion for 007? You can still easily find the original Ian Fleming novels. Raymond Benson’s novels are being reprinted. Jeffrey Deaver has been commission to write a new 007 novel to be published next year. There are video games coming out. You can still watch DVDs of the 21 Eon 007 films, Never Say Never Again and the 1967 Casino Royale. There are alternatives.

005. What’s annoying about being a Bond fan? Here’s one possibility: the Know-It-All Fan. This is the person who claims an inside connection and that they simply know *more* about it than you do. All fandoms have this, but James Bond fandom has been more corporate than many others. If you encounter such a fan on a message board, you may even try to inquire just *how* they know this, but the Know-It-All Fan will scoff with never answering the question.

Comments by the Know-It-All Fan raise two possibilities: 1) the Know-It-All Fan doesn’t really know (bad enough) or 2) the Know-It-All Fan does have a connection at least of a sort. But with No. 2, that means Know-It-All Fan is, essentially, in the pocket of James Bond filmmakers (or whoever). This type of Know-It-All Fan’s isn’t going to jeopardize that access. Their primary interest is maintaining access, not full disclosure.

006. How do you deal with Know-It-All Fan? It’s tempting to call Know-It-All fan out. Ultimately, though, it’s going to be fruitless. You should either ignore them or just nod as if you were listening.

007. Gee, this is kind of grim picture of James Bond fandom. Why continue being a fan? We’re in a lull (maybe an extended lull, maybe not) in the film series. Thus, there’s not much new on the film front other than MGM’s debt situation, etc. In other words, nothing much fun to change the subject. But, as we said, there are alternatives, including new books and video games. And James Bond is still James Bond. If you like 007, all of this is worth putting up with. It’s just how you choose to go about it.

MGM watch: Nikki Finke Web site says nothing new on Bond 23

Nikki Finke’s Deadline Web site says it’s way too early to say Bond 23 is dead.

A post by editor Mike Fleming says reports from the Daily Mirror (and others) this past weekend that Bond 23 has been canceled are over the top:

While Sony, Fox, and Warner Bros would love to grab the Eon Productions franchise, I’m told reliably that as long as MGM’s debt restructuring is preceded by a pre-packaged bankruptcy, Bond isn’t going anywhere.

For the uninitiated, in a pre-packaged bankruptcy, a company first obtains agreements from its lenders on restructuring its debt. The company then files for bankruptcy, but the having the agreements in hand minimizes the time in bankruptcy court.

In an update to the post, Fleming added this:

“You are absolutely right, there is no new news. Development will resume once MGM is viable again, as Danjaq can’t go anywhere without them. So all bets are off. No idea when this will get resolved,” a source integral to the Bond franchise told Deadline London editor Tim Adler today.

To read Fleming’s entire post (which also says Daniel Craig and would-be director Sam Mendes aren’t going anywhere, click the above link or JUST CLICK HERE.

Here’s also a shoutout to the Commander Bond.net Web site, which had its own summary YOU CAN READ BY CLICKING HERE. That summary, by Matt Weston, also includes a link to a related Hollywood Reporter link.

UPDATE: MGM, meanwhile, is seeking yet another extension of a moratorium on its debt payments, according to a July 7 story by Ronald Grover on Bloomberg.com:

Metro-Goldwyn-Mayer Inc., the film studio up for sale after falling behind on $3.7 billion in debt, will ask lenders to extend a moratorium on interest payments, according to two people with knowledge of the situation.

The Los Angeles-based company will e-mail ballots to more than 100 creditors this week, said one of the people, who asked not to be named because discussions are private. The current forbearance expires on July 14.

You can read the entire story by CLICKING RIGHT HERE.

Daily Mirror reports Bond 23 `canned’ because of MGM financial ills

The Daily Mirror newspaper in the U.K. in a July 2 story is reporting that BOND 23 HAS BEEN CANCELED OR, AS THE PAPER PUT IT, CANNED. Here’s an excerpt:

The new James Bond film, due for release by 2012, has been canned due to a cash crisis.
(snip)
(I)t has confirmed the movie has been axed –- and it could be years before the secret agent with a licence to kill is back on the big screen.

The confirmation comes from a “glum insider,” not identified by name or title by the newspaper. Eon Productions said in April it was suspending development of the film, citing financial uncertainty at Metro-Goldwyn-Mayer Inc., which owns half of the 007 franchise.

The Daily Mirror quotes a new statement from Eon that simply says the production company doesn’t know when work will resume and won’t comment further. The “cash crisis” referred to in the excerpt is MGM’s, still coping with a large debt load and an uncertain future.

Note: we first spotted this on the MI6 fan Web siteand you can read that summary, which cuts and pastes from much of the original article by CLICKING HERE. Or if you missed the link to the original article above, YOU CAN CLICK HERE.