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Amazon has closed on its $8.45 billion purchase of Metro-Goldwyn-Mayer, buying the rights to some of the production company’s iconic stable of films that includes the Rocky and James Bond franchises.
‘MGM has a nearly century-long legacy of producing exceptional entertainment, and we share their commitment to delivering a broad slate of original films and television shows to a global audience,’ said Mike Hopkins, senior vice president of Prime Video and Amazon Studios, in a statement.
The deal was first announced in May of last year.
MGM, founded in 1924, has a library of about 4,000 movies and 17,000 TV episodes, according to Indiewire. The company emerged from bankruptcy in 2010 and has relied on other companies to market and distribute many of its films since.
Amazon will take ownership of the brand’s post-1986 catalog. Everything before that was sold decades ago and is now distributed by Warner Bros.
The merger will significantly expand the e-commerce company’s offerings as it continues to move into digital streaming, but it has also been met with some backlash from those opposed to the increasing power and influence of Amazon, one of the most valuable companies in the world.
Amazon announced the deal after a Federal Trade Commission waiting period expired, the Washington Post reports. The regulatory agency, which is supposed to uphold antitrust law and prevent monopolies, is currently in a 2-2 partisan deadlock.
Amazon has closed on its $8.45 billion purchase of producer an distributor Metro-Goldwyn-Mayer
In December 2020, MGM said it was exploring a sale. It said it had tapped investment banks Morgan Stanley and LionTree LLC, and started a formal sale process
European regulators approved the deal earlier this week, claiming that it would ‘not significantly reduce competition,’ the Post reports.
Besides Prime Video, Amazon also has a free streaming service called IMDb TV, where Amazon makes money by playing ads during movies and shows.
Households with Amazon Prime memberships typically spend $3,000 a year on Amazon, more more than twice what households without the membership spend, according to Morgan Stanley, which is why Amazon wants to invest in Prime.
‘The acquisition thesis here is really very simple,’ Amazon CEO Jeff Bezos said in a meeting last year.
‘MGM has a vast, deep catalogue of much beloved intellectual property. And with the talent at Amazon and the talent at MGM Studio, we can reimagine and develop that IP for the 21st century. It will be a lot of fun work and people who love stories will be the big beneficiaries.’
But not everyone was happy.
In an op-ed a month later, screenwriter John Logan, 59, said he felt a ‘chill’ when he learned of the deal. He wrote the screenplays for Skyfall and Spectre, starring Daniel Craig.
John Logan, 59, who wrote the screenplay for Skyfall and Spectre, starring Daniel Craig, above, has warned against Amazon trying to impose artistic control over the James Bond franchise
Logan says he fears Amazon could try and interfere with the series’ trademark violent plots, or even push for spin-off series that could dilute the Bond brand.
Writing a guest essay for the New York Times, Logan said the Bond films were a ‘family business’ that had been carefully nurtured by producers Barbara Broccoli, whose late father Albert ‘Cubby’ Broccoli is credited as the mastermind behind the success of the long-running franchise, and her half-brother Michael Wilson.
Logan has been nominated for an Oscar three times for screenplays for The Gladiator, Hugo and The Aviator
Logan said Bond’s enduring appeal was that it had protected the Bond character ‘through the thickets of moviemaking and changing public tastes’.
Logan acknowledged the Amazon-MGM deal included ‘ironclad assurances of continued artistic control’, but questioned what guarantees there were that these would remain in place.
Known for its roaring lion logo, MGM is one of the oldest Hollywood studios, founded in 1924 when films were silent.
It has a long list of classics in its library, including ‘Singin’ in the Rain,’ though Amazon will only own post-1986 content.
More recent productions include reality TV staples ‘Shark Tank’ and ‘The Real Housewives of Beverly Hills,’ as well as the recent Aretha Franklin biopic ‘Respect’ and the Lady Gaga-helmed House of Gucci.
‘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,’ Mike Hopkins, senior VP of Prime Video and Amazon Studios, said in a statement announcing the deal. ‘It’s very exciting and provides so many opportunities for high-quality storytelling.’
The heft price tag is a drop of rain in an ocean for Amazon – a $1.6 trillion behemoth – but companies that kicked the tires on MGM when it was being quietly shopped last year were shocked over the price, according to Variety.
They believed the studio was worth around $5 billion to $6 billion with the assumption of some debt, Variety reported.
In comparison, Disney paid less for Star Wars and Marvel in two separate purchases when it bought Lucas Films in 2012 for $4 billion and Marvel for $4.05 billion in 2018.
Major titles Amazon gets (including United Artists titles) and doesn’t under deal to buy MGM
GETS DOESN’T GET
12 Angry Men Wizard of Oz
Basic Instinct Gone with the Wind
Creed A Christmas Story
James Bond The Haunting
Legally Blonde A Night at the Opera
Moonstruck San Francisco
Poltergeist Red Dawn
Raging Bull Cabin in the Sky
Robocop A Day at the Races
Rocky Waterloo Bridge
Silence of the Lambs A Christmas Carol
Stargate Pride and Prejudice
Thelma & Louise Ben Hur
Tomb Raider Dr. Jekyll and Mr. Hyde
The Magnificent Seven Angels in the Outfield
The Pink Panther Rhapsody
The Thomas Crown Affair Julius Caesar
Spaceballs Jailhouse Rock
Of Mice and Men Romeo and Juliet