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MGM Resorts International Message Board

  • hiep_h_vo hiep_h_vo Oct 12, 2010 8:51 AM Flag

    "prepackaged bankruptcy."

    DOW JONES NEWSWIRES

    Lions Gate Entertainment Corp. (LGF) has made a merger offer with ailing Metro-Goldwyn-Mayer Inc. and disclosed the move has the backing of Lions Gate's three biggest shareholders.
    The largest is Carl Icahn, who has been pushing for such a deal since at least late last month, the Wall Street Journal reported two weeks ago. Icahn said in a statement Tuesday the combination would "enhance value for all constituencies" and benefit MGM more than its planned combination with Spyglass Entertainment.
    MGM, saddled with more than $4 billion in debt, is trying to quickly reorganize through a so-called "prepackaged bankruptcy." As part of the plan, Spyglass--the small production company behind "Star Trek and "Get Him to the Greek" --would contribute films and other assets in exchange for a roughly 5% equity stake.
    Icahn holds a "significant" portion of MGM debt, he said Tuesday. He also owns nearly one-third of Lions Gate's stock and has been waging a long-running fight to take control of the company.
    Details of the proposed Lions Gate-MGM merger weren't disclosed in a filing with the Securities and Exchange Commission beyond saying the combined company would be owned by MGM's debtholders and Lions Gate's stockholders. Lions Gate added the proposal was sent Monday "following detailed discussions" with Icahn.
    Lions Gate shares closed Monday at $7.48 and were inactive premarket.

 
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