- Amazon is negotiating to acquire MGM Studios for about $9 billion, Variety reported.
- MGM Holdings has been exploring a sale since at least December.
- A sale would point to Amazon expanding its Prime streaming library to include MGM's content.
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Amazon has been in negotiations to acquire MGM for about $9 billion, Variety reported Monday.
Industry sources told the news outlet that the tech giant had been negotiating a deal for "weeks." The Information first reported Monday that Amazon was in talks for a deal that could run $7 billion to $10 billion.
Mike Hopkins, the senior vice president of Amazon Studios and Prime Video, is said to be orchestrating the deal directly with MGM's board chairman, Kevin Ulrich, according to the Variety report. Ulrich's Anchorage Capital is a major MGM shareholder.
A sale of MGM to Amazon could signal the tech company's move to expand its Amazon Prime streaming inventory to include MGM's extensive array of big-name movies and TV shows. These include the James Bond, Hobbit, Rocky, and Pink Panther franchises alongside "Legally Blonde" and "A Star Is Born."
MGM also owns the streaming service Epix.
The Wall Street Journal reported in December that MGM was exploring a sale. The company had already started a formal sale process, and prospective buyers had been expressing interest since last spring, per The Journal's report, which also cited people who said the company had a market value of $5.5 billion.
Other companies have also been in the running to acquire MGM, including ViacomCBS and Sony Pictures Entertainment.
Representatives from Amazon and MGM did not respond to a request for comment.
Like the rest of the film industry, MGM was hit by the coronavirus pandemic, and it had to push back the release of the next Bond installment, "No Time To Die."
Its revenue dropped 3% year-over-year to $1.5 billion in 2020, it said in its latest financial report. Its film segment was the worst hit, with an 83% fall in revenue from theatrical releases, as movie theaters closed or operated at lower capacity.
But the company said it was saved by its deep catalog, which includes about 4,000 films and 17,000 TV episodes, and its chief operating officer, Christopher Brearton, said in the company's third-quarter earnings announcement that 2021 could be its biggest-ever year for new content.
Amazon has been knuckling down on investment in its media division as demand for streaming has boomed during the pandemic.
Last month, Amazon's streaming service surpassed 200 million Prime members worldwide – 175 million of whom streamed Prime Video content in the past year, according to Amazon CEO Jeff Bezos, who said streaming hours were up more than 70% year-over-year.
The company said it made $7.6 billion – or about 7% of its total net sales – from its subscription services in the first quarter of 2021.