Amazon's Hollywood push: Will acquire MGM Studios for $8.45 billion
Shortly after launching miniTV, Amazon has struck a deal with Hollywood studio MGM Holdings to buy out the latter for $8.45 billion. The deal includes selling the rights for popular franchises such as James Bond and Shark Tank to Amazon. The acquisition emphasizes Amazon's renewed interest in the entertainment business, where it competes directly with Netflix and Disney++. Here are more details.
Amazon purchasing rights for 4,000+ films, 17,000+ shows
Amazon's acquisition of the studio from the era of silent films will give it access to over 4,000 films and 17,000 TV shows including hit titles such as Legally Blonde, Rocky, Silence of the Lambs, The Pink Panther, and Thelma & Louise. Once these shows become Amazon's property, it could catapult Amazon's Prime Video streaming services to new heights in the coming years.
Amazon will have only 50 percent control over Bond franchise
The New York Times reported that Amazon will only own 50 percent of the Bond franchise. The other half is held by Barbara Broccoli and her brother Michael G. Wilson. The siblings retain complete creative control including deciding when a new Bond film is made.
Amazon intends to preserve MGM's heritage and content library
Senior Vice-President of Prime Video and Amazon Studios, Mike Hopkins said, "The real financial value behind this deal is the treasure trove of intellectual property in the deep catalog that we plan to reimagine and develop together with MGM's talented team." The acquisition announcement noted, "Amazon will preserve MGM's heritage and catalog of films, and provide customers with greater access to existing works."
MGM deal is Amazon's second-largest acquisition of a company
Besides the enormous catalog of content that would eventually be available on Prime Video, Amazon will be able to use MGM's established studios to create more original content. This is Amazon's largest-ever acquisition, second only to its Whole Foods acquisition for $13.7 billion in 2017. Bloomberg reported that it follows Amazon's $11 billion investment into video and music streaming content last year.
Deal marks end for MGM's bumpy era of hedge-fund ownership
Bloomberg reported that the acquisition marks an end for MGM's bumpy era of hedge-fund ownership that began with a 2010 bankruptcy agreement. The agreement saw $4 billion in debt wiped off MGM's records as Anchorage Capital Group LLC became a leading shareholder. Although this deal could steer Amazon in a new direction, it continues to face class-action lawsuits alleging monopolistic and anti-competitive behavior.