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Indian firm eyes MGM's debts
By Tony Munroe and Alexei Oreskovic |
September 21, 2010, Tuesday
|
Print Edition
Print Edition
INDIAN conglomerate Sahara India Pariwar is in discussions about buying the debt of struggling film studio Metro-Goldwyn-Mayer for US$1.5 billion to US$2 billion, according to two people familiar with the matter.
The sources did not elaborate on Sahara India's plans for MGM, which has about US$4 billion in debt, and stressed that the talks were still at a preliminary stage.
"Our mutual interest discussions are on but it's too early to comment on the issue," said Abhijit Sarkar, corporate communications chief of Sahara India, which owns businesses in media, entertainment, real estate and insurance.
Earlier this month, MGM said that it won extra breathing room to make its debt payments, with its lenders agreeing not to seek remedies for nonpayment of debt until October 29.
One source said that Sahara India was contemplating a nearly US$2 billion, all-cash deal for MGM's debt. Another source pegged the deal at US$1.5 billion.
MGM has a film library that includes the James Bond and Pink Panther franchises, but it has been struggling to create new hits. It is also coping with plunging DVD sales as consumers move to viewing online.
The studio is saddled with debt from a US$2.85 billion buyout in 2005 by a group that included private equity firms Providence Equity Partners, TPG, Quadrangle Group and DLJ Merchant Banking Partners, and media companies Sony Corp and Comcast Corp.
The sources did not elaborate on Sahara India's plans for MGM, which has about US$4 billion in debt, and stressed that the talks were still at a preliminary stage.
"Our mutual interest discussions are on but it's too early to comment on the issue," said Abhijit Sarkar, corporate communications chief of Sahara India, which owns businesses in media, entertainment, real estate and insurance.
Earlier this month, MGM said that it won extra breathing room to make its debt payments, with its lenders agreeing not to seek remedies for nonpayment of debt until October 29.
One source said that Sahara India was contemplating a nearly US$2 billion, all-cash deal for MGM's debt. Another source pegged the deal at US$1.5 billion.
MGM has a film library that includes the James Bond and Pink Panther franchises, but it has been struggling to create new hits. It is also coping with plunging DVD sales as consumers move to viewing online.
The studio is saddled with debt from a US$2.85 billion buyout in 2005 by a group that included private equity firms Providence Equity Partners, TPG, Quadrangle Group and DLJ Merchant Banking Partners, and media companies Sony Corp and Comcast Corp.
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