MGM files for bankruptcy

By Julianne Pepitone, staff reporter


NEW YORK (CNNMoney.com) -- MGM has filed for Chapter 11 bankruptcy protection as part of a "pre-packaged" plan with creditors, the movie studio said Wednesday.

In court papers filed in New York, the movie studio behind "Rocky:" and the James Bond movies said its bankruptcy should last only about 30 days.

Under the terms of the deal, major lenders Credit Suisse and JPMorgan (JPM, Fortune 500) will exchange $4 billion in outstanding debt for most of MGM's equity when it emerges from Chapter 11 protection.

MGM will then be transferred to the control of Gary Barber and Roger Birnbaum, who run the movie company Spyglass Entertainment.

MGM has also agreed to a deal with Carl Icahn, one of its largest shareholders, in exchange for the billionaire investor's support in its restructuring. Icahn had previously pushed for MGM to merge with another studio, Lions Gate Entertainment.

In a prepared statement, MGM executives said the studio "is emerging from one of the most challenging periods of its storied history."

The company said it expects to raise $500 million after emerging from bankruptcy to finance projects including the production of films and TV series. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 17,681.64 324.77 1.87%
Nasdaq 4,727.67 83.36 1.79%
S&P 500 2,049.65 36.76 1.83%
Treasuries 2.20 0.06 2.61%
Data as of 3:22pm ET
Company Price Change % Change
Bank of America Corp... 17.42 0.15 0.90%
Apple Inc 111.82 2.41 2.20%
Oracle Corp 44.97 3.81 9.26%
General Electric Co 24.98 0.55 2.26%
Ford Motor Co 14.74 0.29 1.97%
Data as of 3:07pm ET

Sections

Sony may have pulled its controversial film 'The Interview', but North Korean citizens may soon have copies dropping from the sky. More

With two recent IPOs and a digitally-inclined audience of entrepreneurs, non-traditional financing could finally get its big break. More

Payday lenders are spending millions of dollars in Washington in an attempt to get powerful politicians on their side as a government crackdown on the industry heats up. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.