Wednesday, November 29, 2023

Amazon will pay R116 billion to acquire MGM film studio has agreed to buy film company Metro-Goldwyn-Mayer for $ 8.45 billion (rand 116.3 billion), a bet that the nearly 100-year-old Hollywood icon will have an insatiable demand for streaming content that can be fulfilled.

This acquisition is Amazon’s biggest acquisition as the company agreed to buy Whole Foods in 2017 for $ 13.7 billion (R189 billion), but follows an investment of about $ 11 billion ($ 151 billion). R).

“The real financial value behind this deal is the intellectual property in a large catalog that we plan to reconsider and develop with the talented team at MGM,” said Mike Hopkins, senior vice president of Prime Video and Amazon Studios, in a statement. “It’s very interesting and offers so many opportunities for high-quality storytelling.”

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Amazon previously acquired smaller startups that were seen as a threat – such as a shoe retailer Zappos or mother of Quidsi. Amazon has also taken advantage of new and emerging business areas, such as the gaming platform Twitch or Kiva which builds storage robots.

For MGM, the studio that brought James Bond and Scarlett O’Hara to the big screen, the deal marks the end of an era of unequal hedge fund ownership that began more than a decade ago. MGM’s main shareholder is Anchorage Capital Group LLC, which is co-owned with three other investors under a 2010 bankruptcy agreement that wrote off an estimated $ 4 billion in debt.

Hedge funds have rarely made such investments for more than a few years, and observers had long thought that Barber was preparing the studio to sell. In 2017, reports indicated that MGM was in talks with Chinese companies even though no agreement was reached.

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