Amazon is buying MGM Studios for $8.45 billion, the companies announced Wednesday, May 26, expanding their entertainment control within its Prime membership offering. The deal is Amazon’s second-largest acquisition. It paid $13.7 billion for Whole Foods in 2017. Amazon said it hopes to leverage MGM’s storied filmmaking history and wide-ranging catalog of 4,000 films and 17,000 TV shows to boost Amazon Studios’ film and TV division. “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 vice president of Prime Video and Amazon Studios says. “It’s very exciting and provides so many opportunities for high quality storytelling.”
In a statement, MGM Chairman Kevin Ulrich says: “The opportunity to align MGM’s storied history with Amazon is an inspiring combination.” MGM will make Amazon’s TV and film library even more lengthy. The Hollywood studio owns the James Bond film catalog and has made several hit shows including The Handmaid’s Tale and Fargo. It also owns premium cable network Epix and owns several popular reality TV shows, including Shark Tank, Survivor, and The Real Housewives. MGM, which is a private company, has been seeking a buyer for several years. Additionally, MGM has actively been exploring a sale since December, looking to cash in on streaming-video services seeking content. The Wall Street Journal reported in December that MGM had a market value of roughly $5.5 billion, significantly less than the price tag Amazon agreed to. Its owners include Anchorage Capital, Highland Capital Partners, Davidson, Kempner Capital Management, Solus Alternative Asset Management and Owl Creek Investments — funds that took control of the studio when it emerged from bankruptcy in 2010.
Amazon’s Prime video program, which also features original and award-winning shows like The Marvelous Mrs. Maisel, has more than 200 million paid subscribers, which closely numbers up to its competitor, Netflix, which has 208 million subscribers.
