MGM Files Chapter 11 Bankruptcy: The Lion Weeps Tonight

Image via WikipediaSpeaking of James Bond, Metro-Goldwyn-Mayer Studios, Inc., which owns the rights to the 007 film franchise, filed a voluntary petition for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York today.

The Am Law Daily blog reports that more than 100 MGM bondholders and lenders signed off on the pre-approved re-organization plan, which involves swapping a $4 billion debt for a 95 percent ownership stake in the film studio when it emerges from bankruptcy protection. The plan is for Spyglass Entertainment executives to oversee MGM's operations once the post-bankruptcy dust settles.

MGM hopes to raise $500 million and continue to churn out tv programs and films as a leaner and meaner post-bankruptcy company.  The studio is hopeful the court will okay the proposed re-organization within 30 days.

An effect of the 14-page bankruptcy filing is that it wipes out the ownership stakes of the consortium that presently owns MGM, including Comcast, Sony and a handful of private equity firms.

Ars Gratia Artis ("Art for Art's Sake") and all that, but a movie mogul has gotta eat.