MGM, one of the most powerful and recognizable studios from the past 85 years is on the verge of bankruptcy. Apparently the company made a desperate plea on Thursday asking for help rounding up an extra $170 million in emergency funds.
MGM called bondholders to make a desperate plea for money because the studio has missed its goal numbers and are running out of funds. They are in need of about $20 million in short term cash flow to cover overhead and an additional $150 million to get through the end of the year and to start Peter Jackson’s Hobbit. While not one executive is completely to blame, many seem to be unhappy with the direction Harry Sloan has led the company.
MGM has over $3.5 billion dollars in debt and bondholders told the studio that they were planning on letting them go bankrupt. This would be the worst possible scenario for the company that would then lose its rights to James Bond and “the studio doesn’t think it can stay alive without 007″. This could also pose serious problems for The Hobbit, which is mainly being funded by the studio.
Do you think can MGM survive this setback? How does this affect your favorite movies and franchises?