After nine months of tumult over the future of Metro-Goldwyn-Mayer, the storied movie studio’s fate now rests in the hands of debt holders with little experience in the entertainment business.
Hedge funds that control large chunks of MGM’s $3.7-billion debt, including Anchorage Advisors and Highland Capital Management, are ignoring a 2-month-old acquisition offer from Time Warner Inc. and a restructuring plan backed by Chief Executive Stephen Cooper, a turnaround expert brought in last year, to reboot the studio with $1 billion in new capital.
The internal divide and lingering uncertainty demonstrate how tortured MGM’s reorganization process has been and how the balance of power has shifted from management to lenders.
• Read the full Los Angeles Times story.
