WILL THESE LIONS MATE?
Friday, November 13 2009
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In what might well result in two lions sharing the same den, Lions Gate Entertainment Vice Chairman Michael Burns said Thursday that his company is exploring the possibility of buying the Metro-Goldwyn-Mayer studio. Both companies feature lions in their logos. At a New York investment conference, Burns said that while Lions Gate is interested in acquiring MGM, "It's all about price." Any deal for the company would include $3.7 billion in debt, which would be offset by the value of MGM's existing film library, which includes 4,100 titles, the James Bond franchise, and partial rights to The Hobbit, the two-film prequel to The Lord of the Rings, which is in pre-production. "I think we'll know sooner rather than later" whether the value of those properties, which, he said, were "worth a lot of money," will make a deal doable, Burns said. Some analysts have speculated that investors may attempt a takeover merely to gain control of the library and the Bond franchise. But Burns suggested that Lions Gate would keep the studio in business, saying that the library is valuable only if new releases increase its worth.
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