MGM Proposes Bankruptcy Package

Movie studio Metro-Goldwyn-Mayer, home of movie franchises such as James Bond and The Pink Panther, proposed a bankruptcy plan that would reduce its debt by $4 billion and put the founders of Spyglass Entertainment in charge of the legendary studio.

MGM said it is seeking lenders' votes for the plan, which would involve secured lenders exchanging more than $4 billion in debt for 95.3% of equity in the company once it emerges from Chapter 11, Reuters reported.

The restructuring would clear the way for the making of "The Hobbit," a two-part prequel to the blockbuster "Lord of the Rings" trilogy.

The studio has struggled with debt after a $2.85 billion buyout in 2005. The group leading the buyout included media company Sony Corp. (SNE) and private equity company Providence Equity Partners.

The company's secured lenders have until Oct. 22 to vote on the plan.
Heard about this on the news and doing some searches for articles about it, I kept seeing blurbs from different fan sites about how this might effect their particular interest (will this lead to a robocop tv series? How will it affect The Hobbit? The next Bond Film etc.).

Man, when the US film companies are falling down, it really seems bleak. Hopefully this will help put pressure on MGM and others to adapt to the times.