MGM watch: Wall Street Journal previews vote by studio debt holders

The Wall Street Journal has a detailed story on its Web site previewing the Oct. 29 vote by Metro-Goldwyn-Mayer Inc. debt holders that will determine who gets to run MGM: Spyglass Entertainment’s co-founders Gary Barber and Roger Birnbaum, or investor Carl Icahn.

The story (which you can read in its entirety by CLICKING HERE) lays out this scenario if the Spyglass plan gets the nod:

If it wins enough support—odds appear to favor it—MGM will file for a Chapter 11 bankruptcy as soon as Sunday, and the 86-year-old company, the source of more than 200 Academy Awards for classics like “Gone with the Wind,” will pass to distressed-debt investors more accustomed to reworking home-health-care firms and community banks.

They aim to be ruthless about costs. They plan to outsource to another studio the task of distributing films to theaters, then focus on the television business—cutting deals with cable-TV channels, video-on-demand services and online streaming companies, especially abroad….(Barber and Birnbaum) would make just four to six movies a year, most with modest budgets of $50 million or so, though allowing for an occasional big one.

The story, by Mike Spector and Lauren A.E. Schuker, includes details of a March meeting where creditors didn’t support a MGM management plan to raise $1 billion to make 10 “big movies” a year, eventually leading to the Spyglass plan.

MGM’s half stake in the James Bond franchise is only mentioned in passing and there’s no specific information on the stalled Bond 23. Michael G. Wilson and Barbara Broccoli, the half-siblings who run Eon Productions, suspended work on Bond 23 in April because of the MGM financial uncertainty. If the Journal story is accurate, one possibility is that the March meeting described in the Journal story is one reason why. Eon controls the other half of the 007 franchise.

Eon’s drive for ‘respect’ and how it affects the 007 film franchise

The Peter Morgan situation (fiasco?), where Eon Productions’ flirtation with a “prestige” writer didn’t pan out, got us to thinking about the state of the James Bond movie franchise. As Lt. Columbo on more than one occasion said, “little things” bothered him about a case. So it is with our concerns about the state of the James Bond movie franchise.

Peter Morgan wrote Frost/Nixon and other movies that had the label of being a Very Important Film. So, in 2009, when Eon announced that Morgan would be part of a writing team to script Bond 23, it got a lot of attention, especially among Bond fans. Months after ending his 007 writing efforts, Morgan gave an interview where he indicated he really didn’t care that much for the Bond concept.

In a way, that seems to seems to represent the approach of Michael G. Wilson and Barbara Broccoli after the death of Albert R. Broccoli, Eon’s co-founder, in 1996. There have been hints of this for awhile. Michael Apted got hired to direct 1999’s The World Is Not Enough, even though he had basically no experience directing action films. But the stepson and daughter of Cubby Broccoli really hit paydirt on the respect scale with 2006’s Casino Royale, which arguably got the best reviews of a 007 film in decades. Part of the reason was co-screenwriter Paul Haggis, known as a writer and director of Very Important Movies, despite the fact he also created the schlocky TV series Walker, Texas Ranger.

That’s a heady thing to ignore. So the duo hired Marc Forster, also known as a director of Very Important Movies, such as Monster’s Ball, to direct Quantum of Solace, with Haggis returning as the lead writer, getting first billing ahead of Neal Purvis and Robert Wade. The result: a $230 million-budgeted movie that was hard to follow in many places and seemed twice the length of its 106-minute running time, the shortest of the 22-film Eon/Bond series.

For an encore, the Wilson-Broccoli duo hired Peter Morgan to write Bond 23. Now the delay in Bond 23, understandably, is blamed on financial problems at Metro-Goldwyn-Mayer Inc., 007’s home studio which also controls half of the Bond franchise with Eon. But even if MGM’s finances hadn’t tanked, there’s some reason to doubt the current Eon regime was up to getting out a Bond film in a reasonable amount of time. In April, when Eon said it was suspending development of Bond 23 because of MGM’s financial ills, it said the film was originally scheduled for a “2011/2012” release. That would have been three or four YEARS after Quantum of Solace.

What’s more, Morgan revealed in an interview that after months of work in 2009, he had gotten no further than a “treatment” (essentially a detailed outline) and never had gotten around to actually writing a script. Aside from Morgan himself plus the grateful city of Vienna (where Morgan lives), it’s hard to see who else benefitted from the decision to hire Morgan in the first place. Morgan made his reputation on films that were lathered in politics. Bond films, while having a few referendces to the time they were made, tended to be as “timeless” as possible. Eon’s co-founders, Cubby Broccoli and Harry Saltzman, de-emphasized the Cold War roots of Ian Fleming novels such as Dr. No, From Russia With Love and Goldfinger, which formed the basis of the first three films of the series. The Russians were the ultimate villains of all three novels; in the first two films the independent SPECTRE took the place of the Soviets while in Goldfinger, the title character was acting independently with the backing of the Chinese.

Bond 23 has been delayed primarily because of MGM’s financial ills, make no mistake. But even if MGM’s finances were fixed tomorrow, Eon would still have a lot of work to do to get a shootable script ready. The Broccoli-Saltzman team was able to do four films in four years and, after that, adhere to producing a film every other year (more or less). It’s unimaginable to envision the current Wilson-Broccoli regime sticking to such a schedule. They seem too busy worrying about their press clippings. The irony: Cubby Broccoli, a supposed hack, in 1982 received the Irving Thalberg Award, one of the most prestigious Hollywood gives to one of its own. Does anyone really think either Michael Wilson or Barbara Broccoli will receive that award anytime soon?

Peter Morgan, 007 fans hardly knew ye

Peter Morgan, screenwriter of Frost/Nixon and other prestige movies, joined a line of scribes such as Len Deighton and Anthony Burgess, who gave a try at writing a James Bond movie and couldn’t get it done. “The whole thing went to hell,” Morgan said in an interivew, published on the Indie Wire blog. “I’m so happy to be doing something else.”

Eon Productions put out a news release last year saying that Morgan would join Neal Purvis and Robert Wade in writing Bond 23. In the Indie Wire interview, which you can view for yourself starting around the 3:20 mark of the following video, Morgan says he “wrote a treatment, I never wrote a script…I went there with an orignial idea.” He never mentions Purvis and Wade.

Take a look for yourself:

In the next video, starting at the 0:15 mark, Morgan says the Bond is dated and “I’m not sure it’s possible to do it … I do think the absence of social reality in the Bond film…if they fix that, or they get that of if they get that in a script, which I’m so hoping they will, where you can actually believe in him, that he isn’t just a person in a dinner jacket…he is a creature of the Cold War, Bond….I just personally struggle to believe a British secret agent is still saving the world.”

Morgan goes on the praise Sam Mendes, the would-be director of Bond 23. You can see for yourself:

Eventually, the financial troubles at Metro-Goldwyn-Mayer Inc., which controls half of the Bond franchise, caused Morgan to cease his efforts, which he clearly doesn’t seem sad about. The fate of Bond 23 won’t be decided until MGM’s future is resolved.

Some observations and specuation about Morgan’s comments:

— Prestige apparently means more to current Eon boss-people Michael G. Wilson and Barbara Broccoli than it did to master showman Albert R. Broccoli, Eon’s co-founder with Harry Saltzman. Broccoli relied on Richard Maibaum, at least for first drafts, while Saltzman tried to entice more prestigious scribes, such as Paul Dehn (on Goldfinger) and John Hopkins (on Thunderball) to revamp Maibaum’s early drafts. Deighton also did some work on From Russia With Love, according to U.K. film historian Adrian Turner, and Burgess was among a gaggle of writers that pitched ideas for The Spy Who Loved Me. But the old Eon seemed to keep it all in perspective (i.e. they didn’t let the search for presige bog down the screenwriting process) than the current crew.

— Morgan sounds like he was never highly interested in the world of 007. You half expect him to sound like Sebastian Faulks, author of a 2008 Bond continuation novel, that it might be a jolly good romp to try writing a Bond movie.

— This is another case why press releases shouldn’t be viewed as any more than the tip of an iceburg.

Tentative answers to 007 questions about Bond 23’s indefinite delay

Eon Productions indefinitely delayed Bond 23 production six months ago because of continuing financial trouble at Metro-Goldwyn-Mayer Inc. At the time, we posed (00)7 questions about the move. There aren’t many definitive answers, but here’s what can be said about the seven questions:

001. How long is indefinite? To quote James Bond (Sean Connery) when he was in the pool with Bambi and Thumper in Diamonds Are Forever, “I haven’t found out yet.” However, one option being considered by MGM debt holders would turn control over to Spyglass Entertainment executives and involve a trip into bankruptcy court. That would involve a “prepackaged” bankruptcy where creditors agree on terms in advance. Still, that’s likely to take a few months.

Also, it appears the Los Angeles Times was correct when it reported in August that Bond 23 didn’t have a script ready for shooting. (We’ll get to that shortly.) Daniel Craig also is doing other projects.

So let’s see: possible trip to bankruptcy court, new management getting up to speed at MGM, a busy actor and a script that’s not ready. To get Bond 23 out in time for Christmas 2011, it’d have to begin shooting by, say, April 1 or so. That appears not to be in the cards. And given the Spyglass deal with MGM isn’t yet certain — investor Carl Icahn is pitching a merger of MGM with Lions Gate Entertainment — you can’t yet count on 2012.

002. Does this mean Daniel Craig has played 007 for the last time? Craig, in his public statements, has said he wants to continue. To read one such example from August in the Hero Complex blog of the Los Angeles Times, CLICK HERE. Still, Craig is a hired hand (albeit a well compensated one). We’ll chalk this down as a tentative no, not because of the actor but because of the uncertainty of the MGM situation.

003. Bye bye Sam Mendes? Mendes’s reported participation as director had generated some buzz about Bond 23 before the production shutdown. David G. Wilson, son of Eon bossman Michael G. Wilson, told the IGN Web site (CLICK HERE for the full post) that Mendes is “very excited to do this film — and it’s a matter of timing too. He’s a hot director, and there’s a danger he would have to go and work on something else so we have to be patient and optimistic.” Once again, we’ll chalk the answer to our original question as a tentative no. The younger Wilson’s comments seem to leave wiggle room that Mendes could depart while saying the director remains enthusiastic about Bond.

004. Bye bye Peter Morgan? Answer affirmative, courtesy of the screenwriter himself. In an interview on the Coming Soon blog said he never finished an outline for Bond 23 when the plug got pulled and he wouldn’t be returning to the project. Eon announced last year it would team Morgan with Neal Purvis and Robert Wade. But Morgan, in the interview, talks about his other projects.

005. Do the Broccolis take this opportunity to cash out? No.

006. Bye bye Judi Dench? Assuming continued good health, answer is likely no as long as Craig returns.

007. How much damage does this do to the 007 franchise? That’s still the biggest question and still the toughest to answer. There have been production shutdowns for about half of the 21 years since Licence to Kill in 1989. Twice (1989 to 1995 and 2002 to 2006) the normal two to three years between films has been extended by one kind of hiatus or another. The current hiatus since 2008 is likely to run at least four years before it’s over.

The whole point of rebooting with Casino Royale supposedly was to show Bond at the start of his career. The momentum of that idea seems blunted even assuming a Craig return in 2012.

Most of these aren’t satisifying answers, but little about the past six months has been satisifying to 007 fans.

Ex-007 scribe Morgan tells NYT about near-death of his Hereafter screenplay

Peter Morgan, hired to write Bond 23 before production got shut down, got his newest screen credit this week when “Hereafter” hit theaters. It turns out his script for the movie directed by Clint Eastwoods went through some complications almost as severe as he has experienced in the world of 007.

Charles McGrath of The New York wrote about it in an Oct. 13 article, which included extensive quotes from both Morgan and Eastwood. A sample:

(Morgan’s) involvement in a project about the afterlife is in many ways even more remarkable than Mr. Eastwood’s, and his script, as it happens, underwent a near-death experience and then a resurrection.

“How did this come about? I have no idea, really,” Mr. Morgan said from his car while stuck in traffic in Vienna, where he lives part of the year and does almost all of his writing. “I am a person of the Enlightenment, as it were.”
(snip)

Normally an obsessive outliner and reviser, he began writing a screenplay without any clear idea of where it was going. “So much of what I usually do offers solution or explanations, but this time I wanted to write something open ended,” he said. “I didn’t want answers. I wanted to ask questions.”

To read the entire story, which goes on to describe how M. Night Shyamalan and Steven Spielberg got interested before Eastwood took over, just JUST CLICK HERE. You can also read Times movie critic A.O. Scott’s evaluation of the film BY CLICKING HERE.

The question for Bond fans is whether Morgan’s Bond 23 work fares as well as his efforts for Hereafter. In an interview with the Coming Soon Web site(which you can read by CLICKING HERE), Morgan indicated he hadn’t gotten past the outline stage when financial troubles at Metro-Goldwyn-Mayer Inc. shut down production. Morgan also made it sound like he won’t return to the project:

CS: I don’t know how much you can talk about this, but as far as working on the James Bond script, how far had you gotten along before they pulled the plug? Did you have a finished script?
Morgan: No, no, no, I hadn’t gotten that far. I was working on an outline when they said, “We’re going to have to stop this process now,” and when it came to the point where I was going to commit to doing the Freddie Mercury film, I sort of discussed with my reps that it would probably take me out of all consideration and that’s what’s happened, and I wish them the best.

MGM watch: Carl Icahn makes his move

Investor Carl Icahn made an offer to Metro-Goldwyn-Mayer Inc. debt holders he hopes they can’t refuse — and entice them to vote against a plan for Spyglass Entertainment to take control of MGM, which controls half of the James Bond franchise.

Here’s an excerpt from a Bloomberg.com story:

Carl Icahn offered to guarantee Metro-Goldwyn-Mayer Inc. lenders a minimum price for the film studio’s debt if they vote with him to block a plan to turn over management of the company to Spyglass Entertainment.

The 74-year-old billionaire offered lenders the right to sell him MGM’s senior secured loans for 45 cents on the dollar, about what they have fetched in recent trades. The offer is conditioned on acceptance by holders of $963 million of the Los Angeles-based studio’s debt, Icahn said today in a statement.

Icahn supports an alternative proposal by Lions Gate Entertainment Corp. to acquire MGM for as much as $1.8 billion in equity and debt.

You can read the entire story by CLICKING HERE.

MGM debtholders have until Oct. 29 to vote on the Spyglass plan, which would also involve a trip into bankruptcy court in a “prepacked bankruptcy.”

MGM watch: studio extends creditor vote 1 week to Oct. 29

Metro-Goldwyn-Mayer Inc. extended by one week, to Oct. 29, the time for its creditors to vote on a plan where Spyglass Entertainment’s top executives would take control of MGM after the studio went through a “prepackaged” bankruptcy. The move further delays when the fate of Bond 23 can be settled.

The press release WHICH YOU CAN VIEW FOR YOURSELF BY CLICKING HERE, doesn’t give much in the way of details.

LOS ANGELES, Oct. 15 /PRNewswire/ — Metro-Goldwyn-Mayer Inc. (MGM), today distributed a supplement to the solicitation package that was originally distributed to MGM’s secured lenders on October 7, 2010. The supplement contains additional details to the Company’s financial information included in the original solicitation materials. In order to provide lenders sufficient time to review the supplemental information, MGM has extended the voting deadline by one week to 5:00 PM ET on October 29, 2010.

Two days earlier, Lions Gate Entertainment, which is allied with investor Carl Icahn in making a play for MGM, said why creditors should cast their lot with that company. YOU CAN READ THAT PRESS RELEASE BY CLICKING HERE. Here’s part of the sales pitch:

This is a unique, once in a lifetime opportunity to create a dynamic, forward-looking studio that unlocks tremendous potential value for Lionsgate’s shareholders and MGM’s various stakeholders,” said Lionsgate Co-Chairman and Chief Executive Officer Jon Feltheimer and Vice Chairman Michael Burns. “A Lionsgate merger with MGM is a natural fit that would bring together two of the most powerful libraries in the world, create significant cost savings, consolidate our mutual global channel operations and generate significant incremental revenue and cash flow. It would create a combined entity with enough scale to leverage all of our distribution platforms worldwide.”

MGM watch: Lions Gate offers to combine operations with MGM

The Associated Press IN A STORY YOU CAN VIEW BY CLICKING HERE reports that Lions Gate Entertainment is offering to combine its operations with Metro-Goldwyn-Mayer Inc. Here’s how the story starts:

NEW YORK — Lions Gate is offering to combine its business with MGM in a deal supported by billionaire investor Carl Icahn, who owns stakes in both studios.

Lions Gate Entertainment Corp. said Tuesday it has sent a proposal for a combination with financially troubled Metro-Goldwyn-Mayer Studios Inc.

Lions Gate said the combined company would be owned by its shareholders and by MGM’s creditors. These include Icahn.

Terms weren’t disclosed, though a report in the Los Angeles Times said the deal would give MGM’s lenders a 55 percent in the combined company. Lions Gate and MGM declined to comment.

Spyglass Entertainment on Oct. 7 began seeking support from MGM creditors for a plan where Spyglass’s top executives would take command of MGM after a “pre-packaged” bankruptcy. MGM’s secured creditors (meaning they have some sort of collateral) have until Oct. 22 to weigh in on that proposal.

For 007 fans, more fun, more complications. Remember the line in 1971’s Diamonds Are Forever where Willard Whyte played Monopoly “with real buildings”? 007’s fate depends on people like that.

MGM watch: Spyglass chiefs to be named co-CEOs of MGM after bankruptcy filing

Nikki Finke’s Deadline site, IN A STORY BY MIKE FLEMING says the co-heads of Spyglass Entertainment are getting closer to taking charge of Metro-Goldwyn-Mayer Inc., with Spyglass’s top executives to take control of MGM after a “pre-packaged” banrkuptcy. Late in the day, MGM put out a press release that confirmed the story.

An excerpt from Deadline:

I’m told that MGM will shortly announce Gary Barber and Roger Birnbaum as its new co-chairmen/CEOs, effective once MGM emerges from Chapter 11. This is part of the long expected restructuring plan, as MGM brass has begun to solicit votes from lenders to convert 100% of the debut to equity, once they emerge from Chapter 11. The lenders will have until October 22 to vote.

Oct. 22, of course, is more than two weeks away and others, such as investor Carl Icahn, have been reported to be kicking the MGM tires, thinking about trying for their own deal. Also, if Spyglass does win out, it still has to get through bankruptcy court. Such a filing would be a so-called “prepackaged” bankruptcy, where the major creditors are in agreement before filing court papers. That’s normally faster than a regular bankruptcy, still takes some time. Thus, Bond 23 remains in its holding pattern.

Late in the afternoon, MGM PUT OUT A PRESS RELEASE ABOUT WHERE THINGS STAND CURRENTLY. Some excerpts:

LOS ANGELES, Oct. 7 /PRNewswire/ — Metro-Goldwyn-Mayer Inc. (MGM) today announced that it has begun a solicitation of votes from its secured lenders for a pre-packaged plan of reorganization (the “Plan”).

MGM expects to continue normal business operations throughout the restructuring process. The Plan provides for MGM’s employees, vendors, participants, guilds, and licensees to be unimpaired.

The Plan provides for MGM’s secured lenders to exchange more than $4 billion in outstanding debt for approximately 95.3 percent of equity in MGM upon its emergence from Chapter 11. Spyglass Entertainment would contribute certain assets to the reorganized company in exchange for approximately 0.52 percent of the reorganized company. In addition, two entities owned by Spyglass affiliates – Cypress Entertainment Group, Inc. and Garoge, Inc. – will merge with and into a subsidiary of MGM, with the MGM subsidiary as the surviving entity. The stockholders of Cypress and Garoge will receive approximately 4.17 percent of the reorganized company in exchange.

Following the receipt of the requisite consents from secured lenders during the solicitation period, and in order to implement the debt restructuring, MGM intends to commence pre-packaged Chapter 11 cases under the U.S. Bankruptcy Code and seek confirmation of the Plan. *Gary Barber and Roger Birnbaum, currently Co-Chairman and Chief Executive Officer of Spyglass Entertainment, would serve as the Co-Chairman and Chief Executive Officer of MGM following the company’s emergence from Chapter 11.* (emphasis added)

The LOS ANGELES TIMES STORY ON THE ANNOUNCEMENT added this:

The beginning of the solicitation of votes on Thursday means that MGM is no longer open to other offers. Companies that previously made acquisition or merger offers and have remained interested, including Warner Bros. and Lions Gate, may not make another bid unless the Spyglass plan is rejected by the debt holders.

MGM watch: WSJ says Icahn trying to force MGM, Lions Gate merger

This is more than enough to make a Bond fan’s head explode. After a day of various media reports (see previous post), News Corp.’s Wall Street Journal is reporting that investor Carl Icahn is trying to force a merger between Metro-Goldwyn-Mayer Inc. and Lions Gate Entertainment.

The above paragraph has a link to the entire story. The article by Mike Spector and Lauren A.E. Schuker starts like this:

Billionaire investor Carl Icahn bought a significant chunk of Metro-Goldwyn-Mayer Inc.’s debt and is pushing the beleaguered film studio to merge with rival Lions Gate Entertainment Corp., said people familiar with the matter.

Mr. Icahn is Lions Gate’s largest shareholder, at just under 33%.

Mr. Icahn told people close to MGM earlier this week he holds somewhere between $400 million and $500 million of MGM’s debt outstanding and is continuing to build his position in the studio, they said. The purchases give Mr. Icahn about 10% of MGM’s outstanding debt.

So to recap:

— MGM has been pursuing a complicated deal with Spyglass Entertainment where Spyglass’s top executives would take command of MGM, the company would then pursue a “prepackaged” bankruptcy to try to wipe out its $3.7 billion debt and MGM would just produce TV shows and movies and cut deals with other studios to release any movies (like James Bond movies) the studio is involved with.

— One News Corp. outlet (the New York Post) reported that Time Warner was boosting/was thinking of boosting its bid for MGM. Another News Corp. outlet (Dow Jones Newswires) reported that Time Warner denied that story.

— One News Corp. outlet (the Post again) said Icahn was mulling getting involved, while another (the Journal story story quoted above) said he was already involved.

By the way, we forgot to mention that News Corp. is run by Rupert Murdoch who, supposedly, was one of the inspirations for media magnate/Bond villain Elliott Carver in Tomorrow Never Dies. The late Robert Maxwell and Ted Turner were also mentioned as inspirations for the character played by Jonathan Pryce.

We’ve said it many times, but we’ll repeat: all of this matters for James Bond movie fans because MGM controls half of the 007 franchise. For Bond fans, it’s a case of pass the Alka-Seltzer. It’s even more reason not to count on attending the premier of Bond 23 anytime soon.