Lions Gate deals tough with MGM
By Ryan Nakashima |
October 27, 2010, Wednesday
|
Print Edition
Print Edition
MOVIE studio Lions Gate Entertainment Corp said on Monday that its proposed takeover of Metro-Goldwyn-Mayer Inc would save more than US$100 million a year in overhead and boost cash flow beyond that by more than US$120 million over five years.
The plans call for laying off 174 people, reducing the total number of employees at the two companies by about 17 percent to 835.
The company made details of its proposal public in a letter to MGM on Monday. Documents were also filed with the Securities and Exchange Commission.
MGM, the studio behind the James Bond and Pink Panther movies, has skipped interest payments, with the agreement of its creditors, on more than US$4 billion in debt since last October as a lack of hits and a downturn in DVD sales brought it to the brink of insolvency.
The details of Lions Gate's proposal were released just days before MGM creditors face a Friday deadline to vote on an alternative plan to merge with a unit of Spyglass Entertainment.
The plans call for laying off 174 people, reducing the total number of employees at the two companies by about 17 percent to 835.
The company made details of its proposal public in a letter to MGM on Monday. Documents were also filed with the Securities and Exchange Commission.
MGM, the studio behind the James Bond and Pink Panther movies, has skipped interest payments, with the agreement of its creditors, on more than US$4 billion in debt since last October as a lack of hits and a downturn in DVD sales brought it to the brink of insolvency.
The details of Lions Gate's proposal were released just days before MGM creditors face a Friday deadline to vote on an alternative plan to merge with a unit of Spyglass Entertainment.
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