NEW YORK, Sept. 13 (UPI) -- A Sony Corp. investor group agreed Monday to buy Metro Goldwyn-Mayer for $2.94 billion plus the assumption of its $2 billion debt.
The agreement in principle was reached hours after Time Warner earlier Monday dropped out of what it deemed overly rich bidding, Daily Variety reported.
Backed by Texas Pacific Group and Providence Equity Partners, Sony apparently made the winning bid over the weekend, triggering Time Warner's withdrawal.
Sony was attracted to MGM for its huge movie library, with more than 4,000 movie titles including the James Bond and "Rocky" series of films.
The apparent key to the deal was Philadelphia's Comcast, one of the nation's largest cable system operators, which agreed to package Sony and MGM content into various movie channels and video-on-demand offerings.
The Comcast angle let Sony justify a higher price for MGM than Time Warner. Sony, in return, offered Comcast the chance to take a minority stake in the Sony-MGM entity at a later date, Daily Variety said.
J.P. Morgan Chase and Credit Suisse First Boston are financing the debt portion of the deal.
Assuming the deal goes through, it will be the third time MGM's majority owner Kirk Kerkorian has sold the studio.
