Movie studio Metro-Goldwyn-Mayer is reportedly considering filing for bankruptcy, and has enlisted Skadden Arps and L.A. bankruptcy boutique Klee, Tuchin, Bogdanoff & Stern to do the honors. The studio is seeking to reorganize some $4 billion in debt.
Debt from the 2004 leveraged buyout is currently crippling MGM. As an alternative to filing for bankruptcy, the company — whose most valuable asset is considered to be its 4,000-film library — put itself up for sale last year. The Wall Street Journal reported in January that several companies — including Time Warner, Lions Gate Entertainment, and Liberty Media — submitted bids.
Rumor is MGM and its counsel are considering a prepackaged bankruptcy plan that would involve trading ownership of the studio for forgiven debts. A forbearance agreement with MGM's creditors is set to expire at the end of the month.
"Hot Tub Time Machine" with John Cusack could be the last MGM movie released prior to the filing or final sale.