James Bond has a new home: Amazon and MGM announced a definitive merger agreement under which Amazon will acquire MGM for $8.45 billion.
MGM, founded in 1924, complements Amazon Studios, which has primarily focused on producing TV programming, the companies said. Amazon will help “preserve MGM’s heritage and catalog of films” and provide customers with greater access to these existing works, the companies added.
For Amazon, snapping up MGM — which has more than 4,000 movies and 17,000 TV shows in its catalog — is a way to supercharge its Prime Video service with a slew of well-known entertainment titles. In addition, Amazon is anticipating being able to mine Metro-Goldwyn-Mayer properties like the Pink Panther, Rocky, and, yes, the 007 franchises for new originals.
“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 announcing the deal. “It’s fascinating and provides so many opportunities for high-quality storytelling.”
Hopkins noted that MGM productions collectively had won more than 180 Oscars and 100 Emmys. The studio has roughly 800 employees globally.
The MGM deal is Amazon’s second-largest acquisition, behind its $13.7 billion purchase of Whole Foods in 2017. Amazon didn’t say when it expects to close the MGM acquisition, subject to regulatory approvals and other routine closing conditions; however, insiders believe the pact will be approved by the end of 2021. The purchase price includes the assumption of MGM’s debt. MGM will continue to operate as a label under the Amazon brand.
Kevin Ulrich, MGM’s chairman who had worked with Hopkins to hammer out a deal, said in a statement, “I am very proud that MGM’s Lion, which has long evoked the Golden Age of Hollywood, will continue its storied history, and the idea born from the creation of United Artists lives on in a way the founders originally intended, driven by the talent and their vision. The opportunity to align MGM’s storied history with Amazon is an inspiring combination.”
The pact comes on the heels of AT&T’s decision to spin off WarnerMedia and combine it with Discovery, a deal that many entertainment analysts have predicted will spark a new round of mergers and acquisitions as media companies and streaming players scramble to lock up the most compelling content available.