Amazon agrees to purchase MGM for $8.45 billion

Recap: MGM has a storied history that stretches back nearly a full century and a massive catalog to boot. More than 4,000 films including Robocop, Poltergeist, Raging Bull, Rocky, Silence of the Lambs, Stargate, Tomb Raider and James Bond will soon be available on Amazon, in addition to 17,000 TV shows such as Fargo, The Handmaid’s Tale and Vikings. Collectively, MGM works have won more than 180 Academy Awards and 100 Emmys.

Where there’s smoke, there’s usually fire. Last week, rumors surfaced claiming Amazon was one of several tech firms in talks with MGM regarding a potential acquisition. One week later, the deal has been sealed.

Amazon announced just moments ago that it has entered into an agreement to purchase MGM for $8.45 billion. That’s in line with the $7 billion to $10 billion range floated last week, and closer to the $9 billion that studio reps were reportedly shooting for. It’s the second-largest acquisition in Amazon’s history behind the $13.7 billion the company paid for Whole Foods in 2017.

“The real financial value behind this deal is the treasure trove of IP in the deep catalog that we plan to reimagine and develop together with MGM’s talented team. It’s very exciting and provides so many opportunities for high-quality storytelling,” said Mike Hopkins, SVP of Prime Video and Amazon Studios.

Share value in Amazon is up just $0.43 percent on the news.

Amazon isn’t the only one making big moves in the media space. Just last week, AT&T said it was spinning off WarnerMedia which would combine with Discovery to create a new streaming giant. That deal is expected to close sometime in mid-2022.

Images credit: Alex Millauer, Kraft74