Amazon (AMZN 1.63%) is in talks to acquire MGM, according to various media reports. The movie studio has produced or distributed a library of popular franchises, including James Bond, Shark Tank, Vikings, The Handmaid's Tale, Rocky, and many others. MGM also owns premium cable channel Epix, as well as a stake in Mark Burnett's Survivor series.
MGM's vast treasure trove of content, estimated at more than 4,000 film titles and 17,000 television episodes, would mark a major coup for Amazon, immediately buttressing the company's production capabilities and beefing up the streaming offerings for Amazon's Prime Video and IMDB Channel.
The deal is reportedly worth between $7 billion and $10 billion, though price may have been a sticking point in the discussions. Talk of a deal comes in the wake of AT&T's (T 0.89%) decision to spin off WarnerMedia and HBO to Discovery (DISCA) (DISCK).
Amazon is rumored to have lured back former executive Jeff Blackburn to head up its newly established global media and entertainment group. Blackburn left the company for a sabbatical before ultimately stepping down to join a venture capital firm. Blackburn headed up Amazon's digital content and advertising businesses, so this would be right up his alley.
MGM is currently owned by a group of private equity firms and reportedly put itself up for sale late last year. Hedge fund Anchorage Capital Group has the largest stake, with additional backing by Highland Capital Management and Solus Alternative Asset Management. At the time, the sellers were valuing the company at roughly $5.5 billion, though no deal was consummated.
The studio has been on the auction block numerous times in recent years. MGM sacked its then-CEO Gary Barber for having early discussions to sell the studio to Apple (NASDAQ: AAPL) back in 2018, on the eve of the launch of Apple TV+. The sales price under discussion at the time was said to be $6 billion.