"Is MGM finally going to be sold?" Heard on the phone in Chris. Anderson's words, Lin Yuquan was not surprised, freezing three feet is not a day's cold, the old MGM looked old as early as 04, when it was burdened with a loan of up to 2 billion US dollars, and had to commit to an international consortium led by Sony to complete the acquisition involving 4.8 billion US dollars in 05.

But such a sky-high acquisition did not save MGM from the fire, for the simple reason that the money from the acquisition was taken by the big boss Cork Corkrian, who owns 74% of MGM, and the debtor, and MGM itself instead of getting it, but accumulated a larger debt.

It sounds incredible, but it's a typical commercial acquisition, yes, the leveraged buyout cost a total of $4.8 billion, but Sony only spent $300 million to get what it wanted - MGM's huge library of 4,100 movies and 10,600 TV series, meeting the needs of the Blu-ray HD DVD format, and also gaining the rights to distribute MGM films, which can be described as a huge reward, and Comcast also spent $300 million. That gave them the right to broadcast MGM stock on their own cable network on a pay-per-view basis, followed by $3.7 billion borrowed by Wall Street investment banks from 200 banks for $1 billion.

The end result was just a few hundred million dollars in working capital and more than $3 billion in debt, with $200 million a year in interest payments.

MGM was fully capable of paying $200 million in interest. It is important to know that MGM's huge copyright library brings hundreds of millions of dollars in revenue to the company every year, but I never expected that there has been a major turning point in DVD sales in the US market in the past two years, except for a limited number of blockbusters. The decline in DVD sales and rentals of ordinary films suddenly made MGM's situation difficult.

If that's all there is to it, MGM's own film business is not competitive, producing a lot of small films every year, but the output is not good, such as Tom Cruise's "Lion in the Sheep's Mouth" and "Assassination of Hitler", which did not meet expectations at the box office, and the debt has not narrowed. On the contrary, it has continued to add up, reaching a huge amount of $3.7 billion, and the annual debt interest payment alone has climbed to $250 million.

Income is getting less and less. Under the vicious circle of paying higher and higher interest on debt, it is not difficult to imagine the end of MGM, which is in full decline, and can no longer afford to run a huge fiscal deficit.

And I saw that MGM was almost reduced to a bottomless black hole. How could Sony and other companies stupidly throw money into it.

Then there was MGM's dismissal of former CEO Harry. Sloane. Hire Stephen. Cooper is the new CEO, who has extensive experience helping Enron navigate a series of issues related to its bankruptcy restructuring.

This is obviously an obvious signal that MGM is no longer good, MGM has a good idea, and hopes that Stephen. Cooper was able to persuade creditors to agree to a debt restructuring plan that would allow MGM to continue operating under its current business model.

The idea is wonderful, but it's impossible for creditors not to see how serious MGM's problems are. Although it has not been officially announced to the public, it is only a matter of time before MGM is put on the shelves for sale.

"Chris. What do you think? Lin Yuquan asked out loud.

"I think it's necessary for us to evaluate whether to get involved in the MGM acquisition, after all, MGM is on the verge of bankruptcy, and there is still a lot of value." Chris. Anderson Road.

Lin Yuquan nodded, MGM's most valuable assets are the huge film library, the ownership of the "007" series of films, and half of the ownership of the "Hobbit" series of films, which is extremely attractive for any film company.

The vast library includes classic films such as Gone with the Wind, Ben-Hur, Rocky, The Wizard of Oz, and Blue Bridge, with a large amount of DVD, cable, and online video-on-demand revenues, as well as numerous remake options.

The "007" film series is undoubtedly the most successful film series in history, since the first 007 movie was released in 1962, 22 have been filmed so far, even the most conservative statistics, the number of moviegoers has exceeded 2 billion, and the total box office is as high as 5 billion US dollars, second only to "Harry. Potter series of movies, but if you take into account inflation, the ability of the 007 series of movies to attract money is absolutely unmatched.

What's even more rare is that the 007 series of movies is still thriving after nearly 50 years, and so far, not a single film has lost money, with the last two 007 films, "Casino Royale" and "Quantum of Solace," grossing $599 million and $586 million respectively.

As a prequel to the Lord of the Rings series, the "The Hobbit" series has the success story and influence of the "Lord of the Rings" series, and undoubtedly has the potential to be a super-blockbuster movie.

"That's right, it's really necessary to evaluate, but our appraisal is only for MGM's various valuable assets, not to buy the whole MGM, and MGM today will not only not help us, but will be a big drag." Lin Yuquan said in a deep voice, MGM has thousands of employees around the world, and the basic operating capital alone is not a small amount every year, not a drag.

"Of course, I don't think many people are interested in MGM itself, everyone wants something valuable." Chris. Anderson Road.

Will you be able to acquire MGM's core assets as you wish? After hanging up the phone, Lin Yuquan shook his head, fools know that it is difficult for MGM's creditors to agree to such an acquisition plan, but it is nothing if it can't be acquired, although these assets are what he wants, but it is obviously not worth paying too much price, and it is better to invest that money in a place where it is more needed.

MGM is a symbol of American cinema and Hollywood, but what about the future of Dawn Movies and Summit Entertainment? Lin Yuquan couldn't help but start thinking about it.

Fortunately, Shuguang Movie has a strong ability to resist risks by relying on the fully industrialized layout of entertainment such as Shuguang Network, Shuguang Cinema Line, Shuguang Film and Television Base, Shuguang Novel Network, and Yuquan Family.

Summit Entertainment's situation is a little more difficult, why MGM has come to this point, the lack of management is naturally a very important reason, but the more important reason is that MGM belongs to the traditional business model of only making money from film production, and does not have the backing of media groups like the six major Hollywood studios.

With the strong support of media groups, Hollywood's six major films have long been driven by film production to develop film-related industries, such as DVD distribution, book publishing, toy and souvenir manufacturing, theme parks, etc., you must know that the profits obtained by deriving the upstream and downstream industry chain are far higher than the film production and distribution itself.

With no TV stations, no cables, no theme parks and other revenue channels, MGM is controlled by others everywhere, and it is inevitable that MGM, which is not effective in film production, will fall into a dilemma, and this is also the crisis faced by Summit Entertainment and all independent film production companies.

The reason why Summit Entertainment is currently developing well is entirely due to the outstanding achievements in film production and distribution, and if the production and distribution fail, in this era of rapidly rising production costs and publicity expenses, the box office reputation of a super-produced movie may cause the company to fall into trouble.

Summit Entertainment must have a stronger ability to resist risks, only continuous expansion and growth, not to mention the film business, now the TV drama business is in its infancy, and variety shows are about to start from the American version of "The Voice of China".

But this is far from enough, TV stations, theme parks, and video websites are all needed by Summit Entertainment in the future, and they are also needed for the overseas development of Shuguang Films.

His ******** journey has just begun, and it is far from satisfying.

But Lin Yuquan's heart is full of pride, he believes that day will not be too far away, yes, it will not be too far away. (To be continued.) )