Amazon, MGM Deal Worth $9B Could Be Finalized, Announced By Tuesday

KEY POINTS

The agreement between Amazon and MGM could be announced as early as Tuesday
However, there is no guarantee that the two companies would reach an agreement
MGM co-owns the "James Bond" franchise

Amazon is closing in on a deal to acquire MGM Holdings for $8.5 billion to $9 billion including debt, people with knowledge of the deal said.

The agreement is expected to be announced this week if the talks don’t fall apart at the last minute, sources told The Wall Street Journal on Monday. The announcement could come as early as Tuesday, CNBC noted.

The deal would mark the second-largest acquisition in Amazon’s history, behind its $13.7 billion purchase of Whole Foods in 2017. The deal could turn MGM, a company founded in the silent film era, into a streaming asset as Amazon competes with Netflix, Disney and other streaming services.

The privately traded MGM co-owns the James Bond franchise and other blockbuster films and TV series. It has co-produced many highly-anticipated films, including "The Hobbit" movies, "The Addams Family," "Legally Blonde," "The Pink Panther" and "A Star Is Born." It also owns a number of famous TV shows, such as "The Handmaid’s Tale" and "Fargo."

The studio has also produced a number of hit reality TV shows, including "Survivor," "The Voice" and "The Real House Wives." It also owns Epix, a premium pay-TV service it acquired from Viacom and Lionsgate for $1.031 billion in April 2017, according to The Hollywood Reporter.

MGM has been seeking a buyer for years. Its owners include Anchorage Capital, Highland Capital and Solus Alternative Asset Management. The hedge fund creditors acquired the company after it filed for Chapter 11 bankruptcy in 2010.

The talks between Amazon and MGM have been going on since the beginning of 2021, but there are still no guarantees the two companies would reach an agreement, sources told The Journal.

In recent years, the e-commerce giant has invested billions of dollars in its film and TV operations and is currently producing a TV series based on J.R.R. Tolkien’s "The Lord of the Rings." The first season of the series has a budget of $465 million.

The synopsis of the series came out on Jan. 12, 2021, nearly three years after Amazon acquired TV rights to the famed novels.