Amazon in talks to buy film studio MGM, say reports

There has been speculation before about Amazon acquiring entertainment companies. PHOTO: REUTERS

NEW YORK (BLOOMBERG) - is in discussions to acquire the nearly century-old Metro-Goldwyn-Mayer movie studio in what would be its biggest push into entertainment yet, according to news reports.

MGM, the storied Hollywood company behind the James Bond series, would help bolster Amazon's Prime streaming service, The Information and Variety said in separate reports. Amazon is weeks into negotiations to buy the studio for about US$9 billion (S$12 billion), according to Variety.

MGM and Amazon declined to comment on the report.

MGM has been seen as a takeover target for years, but was never able to close a sale. The company made a fresh push last year, when it reportedly hired advisers to solicit offers. In seeking a deal, MGM aims to capitalise on the proliferation of streaming services, which has increased demand for large backlogs of content.

It has also discussed other scenarios with tech giants. MGM, whose library includes the Rocky films and Silence Of The Lambs, also held talks with Apple and Netflix about taking its new James Bond film directly to streaming. But the company said last year that it is committed to a theatrical release for the film, which is currently slated for Oct 8 in the United States.

Amazon, meanwhile, is reshuffling its entertainment operations with the return of long-time executive Jeff Blackburn. He briefly left the e-commerce company to join Silicon Valley venture capital firm Bessemer Venture Partners. But now he is taking command of Amazon's entire entertainment division, including the Prime Video streaming service, Amazon Studios and the video-game-streaming site Twitch.

Amazon's bid for MGM is being handled by video executive Mike Hopkins, according to Variety. He is dealing directly with MGM chairman Kevin Ulrich, the publication said.

MGM traces its roots back to the 1920s merger of Mr Marcus Loew's Metro films with a film company run by Hollywood legend Louis B. Mayer. While making great pictures like Doctor Zhivago and 2001: A Space Odyssey, MGM drifted in and out of financial distress in the second half of the 20th century. Over the decades, it was owned by Time, CNN founder Ted Turner and more than once by the late billionaire Kirk Kerkorian.

There has been speculation before about Amazon acquiring entertainment companies. It was previously seen as a possible buyer of AMC Entertainment Holdings, the movie chain, with some investors confusing it with AMC Networks, the owner of cable channels.

Investors suffered a similar sort of confusion on Monday (May 17), with The Information report boosting shares of MGM Resorts International, a casino company that is not part of Metro-Goldwyn-Mayer. MGM Resorts stock jumped as much as 5.8 per cent in late trading before quickly retreating.

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