One lion of film has proposed to merge with another.
Lions Gate Entertainment (NYSE:LGF) has made a bid to acquire financially troubled MGM Studios, which owns several iconic film assets, including the James Bond franchise.
In a statement filed with the U.S. Securities and Exchange Commission, Lions Gate announced on Monday it had sent a proposal to Metro-Goldwyn-Mayer Studios Inc. regarding a potential business combination.
Details of the deal were not disclosed, however, the merged entity would be owned by Lions Gate shareholders and MGM creditors.
MGM has been financially struggling under roughly $4 billion in debt and has been eyed by other media conglomerates including Time Warner.
Any potential merger has the support of Lions Gate’s three largest shareholders, including MHR Fund Management, Capital Research Global Investors and activist investor Carl Icahn, who is an investor in both Lions Gate and MGM.
Icahn said in a statement that the merger would enhance value for both Lions Gate and MGM and is “far better for MGM holders than the current proposal to combine MGM with Spyglass.”
Despite the support for the merger, Icahn said he would continue to pursue his lawsuits against Lions Gate’s recent share transaction with Mark Rachesky where 16.2 million shares were issued to him for $6.20 per share.
Background on Icahn’s takeover bid of Lions Gate is available in previous BIV Business Today stories published since May.