Sahara India Pariwar has made a $2-billion bid to buy the debt of struggling Hollywood studio Metro-Goldwyn-Mayer (MGM) Inc.
Agency reports said the new offer came a day after MGM said it had got another extension on an agreement to put off interest payments on about $4 billion in debt until October 29. The studio has rights to the James Bond franchise and owns half of the upcoming movies based on J R R Tolkien’s The Hobbit. It is facing possible bankruptcy but has several suitors, including Spyglass Entertainment, Time Warner Inc and Lions Gate Entertainment Corp.
It was unclear how MGM’s committee of creditors views the offer. When contacted by news agency AP, a spokeswoman for the studio declined to comment.
If the deal fructifies, this would be one of the biggest overseas acquisitions by an Indian firm in the media and entertainment space. When contacted, a Sahara India spokesperson did not comment.
Sahara has diversified business interests that include financial services, housing finance, mutual funds, life insurance, city development, real estate activities, print and television media, film production, sports, information technology, health care, tourism, hospitality and consumer products. It recently bought a new Indian premier league team – Sahara Pune Warriors – and also sponsors the Indian cricket and hockey teams.
MGM is an American media company, involved primarily in the production and distribution of films and television programmes. MGM was founded in 1924 when the entertainment entrepreneur Marcus Loew gained control of Metro Pictures, Goldwyn Pictures and Louis B Mayer Pictures.
MGM made a series of acquisitions, including Metromedia’s film subsidiaries and took huge debt in the process. It also attempted to take over Universal Studios, but failed and was forced to sell several of its cable channel investments.
The debt load from these business deals negatively affected MGM’s ability to survive as an independent motion picture studio. After a three-way bidding war, which also involved Time Warner, MGM was acquired in 2004 by a partnership led by Sony, Comcast, Texas Pacific and Providence.