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Summay
- Amazon is in talks to acquire the renowned MGM Studios.
- MGM was looking for a buyer since December 2020, as per reported by media sources.
A bid of about $7 to $10 billion is being considered by Amazon for this acquisition of MGM Studios. The news of this acquisition came on 17 May, hours after AT&T reached a spinoff deal with Warner Media and merged it with Discovery. As per media sources, the negotiations are directly going on between the Senior Vice President of Amazon Studios and Prime Video, Mike Hopkins, with Kevin Ulrich, Chairman of MGM Board. The big takeover news of MGM studios in the US has helped in boosting the sentiment across global markets. As per Bloomberg data, the media takeover of $80 billion has been announced so far this year.
Synergies the deal could bring to Amazon
- This acquisition if sealed, would be Amazon’s largest purchase since it bought Whole Foods Market for $13.7 billion in 2017, although the company has been on an acquisition spree businesses since 1998.
- Amazon’s Prime Video is used by around 175 million people worldwide, plus this acquisition would add MGM collection of 4,000 title catalogue having the Bond series and Pink Panther, along with the series TV programs the Unexpected, Boston Blackie in its portfolio.
- If the deal materialises, Amazon - the new heir of MGM studios, would become the biggest player in the content game.
MGM
MGM Studios, an American media company, was founded in 1924. It includes production companies such as Evolution Media, EPIX and Big Fish Entertainment under its umbrella.
To launch a formal sale process, MGM hired Morgan Stanley and LionTree LLC In December 2020. A year back, in December 2019, Apple also reportedly was in talks with MGM.
Covid-19 pandemic has impacted media businesses as well, and MGM, major studios of Hollywood’s golden age has also been also hit by Covid pandemic like the rest of the film industry. Infect, James’s bond film "No Time To Die" had to push its release to October 2021. The company reported a revenue drop of 3 per cent year-over-year to $1.5 billion in 2020.
Also Read: Amazon’s Net Profit More Than Triples In Q1 As Revenue Hits US$100B
Amazon
Keeping in mind the need for skills training in the UK, Amazon is planning to invest £10 million with a time frame of next three. Amazon has been building its media division rapidly. For the Amazon prime services, the company had spent $11 billion in 2020 on movies, music and TV shows.
Looking at the success of Prime, the company also launched miniTV. Although till date, no standalone app exists for miniTV, but an option is available within the Amazon shopping app itself. With the return of longtime executive, Jeff Blackburn who departed from Amazon in February 2021, the company is reshuffling its entertainment operations.
Amazon reported its revenue of 386.1 billion for FY 2020, an increase of 37.6 per cent compared to last year. Net income grew 603.30 per cent to 21.3 billion in comparison to FY17.
Amazon.com Inc (NASDAQ:AMZN) share price was down by 1.37 per cent to USD 3,203.08 at the day’s close on 21 May.
Also Read Amazon to Create 10,000 Jobs in the UK To Boost Employment
