In an act that can only conjure exasperated cries of "About time!" from film industry watchers the world over, Bloomberg reports that the long-suffering MGM has finally filed for bankruptcy, turning down a takeover bid from Lions Gate. The new plan will bring in managers from Spyglass Entertainment and help extinguish the 86-year-old company's $4 billion in debt. For all you financially minded folks in the audience, here's a quote from Stephen Cooper, the man who guided Enron through the Chapter 11 process and who will now do the same for MGM:
"A balance sheet restructuring was the only viable alternative for the company to continue to operate as a going concern...By sharply reducing MGM's debt load and providing access to new capital, the proposed plan of reorganization achieves these goals."
So, uh, yeah. What he said. But let's move on. As sad as it may be to see the MGM lion take a pretty steep fall, you don't come to Cinematical to read about financial gobbledygook, do you? No! You come here to read about movies! What about the status on the 'The Hobbit' and the still-untitled 23rd James Bond adventure, two films that have been caught in a meticulously reported Production Hell for several years now?
On 'The Hobbit':
"MGM estimated its total obligations to "The Hobbit" are $265 million to $275 million. The company said it is looking for "a third party" to fund those obligations. Its investment stake would be $40 million while the rest would be funded by a lender..."
With all of the recent forward momentum on Peter Jackson's 'Lord of the Rings' prequel, with an official start date set and a whole bunch of casting news, this looks to be the project that MGM is hoping will jumpstart them on the long climb out of the red. After all, it's going to make a billion bucks just by existing. It's the friggin' 'Hobbit.' Everyone and their mother and their dog is going to see this movie.
What about Agent 007? What about the most famous movie spy in history, a character who might as well be the mascot for MGM at this point?
"New James Bond films may be released every second year starting in November 2012, MGM said. It aims to own 50 percent of Bond 23, due out that year, with an equal partner paying all of the production costs, it said. Later Bond movies would be wholly owned and funded by MGM..."
The Bond series is no stranger to delays and weird legal problems. Remember the six-year gap between 1989's 'Licence to Kill' and 1995's 'GoldenEye'? Remember how separate producers owned the rights to 'Thunderball,' allowing a Sean Connery-starring remake (retitled 'Never Say Never Again') to compete against the Roger Moore-starring 'Octopussy'? If all goes according to plan, the four-year gap between 'Quantum of Solace' and Bond 23 will be but a minor blip in the franchise's 50 year history.
"If all goes according to plan" being the key phrase there. We're talking about a situation made of glass, precariously balanced on top of a house of cards built on a table made of toothpicks. Who knows what will happen between now and then? With Sam Mendes out of the director's chair and Peter Morgan's screenplay apparently abandoned, they don't even have the skeleton of a movie -- they only have an ideal release date.
For all of the legal and financial details, make sure you check out the fairly comprehensive original article. In the end, all we can hope is that this proves to be the swift kick in the rear that MGM needs. This is a company with a legacy, a company that made some of the greatest films of all time. From a purely historical standpoint (as well as the many jobs that stand to be lost or gained), it would be a shame to lose them.