Amazon is said to be in negotiations on a deal to acquire MGM for approximately $9 billion, according to Variety.
There has been some talk about Amazon sniffing around MGM for a while. However, sources have claimed that Amazon’s interest in buying MGM is beyond regular rumors. The deal is being conducted by Amazon TV Chief Mike Hopkins directly with MGM board chairman Kevin Ulrich.
MGM had already effectively nailed up a “for sale” sign: Variety confirmed in December that the company was looking for a buyer.
News of Amazon’s talks with MGM began to swirl this weekend. The Information reported Monday that Amazon was in talks about a potential deal for MGM, which could run between $7 billion and $10 billion. Industry sources said MGM reps have been whispering to prospective buyers for months about a price tag of $9 billion while others see it as worth about $5 billion.
Amazon currently has more than 200 million Prime members worldwide, and Jeff Bezos recently told investors that 175 million of those streamed Prime Video content in the past year. The company clearly wants to turn Prime Video into an even bigger habit for its customers worldwide — and a quick way to do that would be to add MGM’s library of titles into the mix.
MGM claims to own one of the world’s “deepest libraries” of premium film and TV content, including “The Hobbit”, “Fargo”, “Vikings”, and “Shark Tank”.
For the first three months of 2021, MGM Holdings reported revenue of $403.3 million (up 27% year over year) and net income of $29.3 million (versus a net loss of $12.1 million the year prior).