Time Warner in $1.5 billion bid for MGM

Time Warner will bid $1.5 billion in what is expected to be an all-cash offer for the assets of Metro-Goldwyn-Mayer, owner of the James Bond film franchise.

The owner of CNN and Time magazine group controls Hollywood's largest film library and is seen as placed to generate strong returns from MGM's assets through its distribution network and relationships with pay TV companies. MGM, saddled with $3.7 billion in debt from a 2005 buy-out from a consortium of buyers led by Sony, initially attracted attention across Hollywood and beyond, with companies including News Corp, Liberty Media and AT&T seen as interested. But by last Friday's deadline, only three remained. MGM confirmed that a "number of bids" had been received and that it would review them over the next few weeks. MGM has not ruled out operating as an independent company. The studio had hoped to attract bids topping $2 billion, but has drawn offers of between $1.2bn to $1.5bn, raising the possibility of MGM lenders pushing for a prepackaged bankruptcy instead of facing a fire sale.