By Anne Thompson | Thompson on Hollywood October 29, 2010 at 10:28AM
The MGM lion has had many lives--the fabled studio has run through many chiefs over the decades, but Carl Icahn is not going to be one of them. Mary Parent is gone, and so is Harry Sloan, as well as UA's Tom Cruise and Paula Wagner. Finally, we know, the newest chieftans are the Spyglass duo Roger Birnbaum and Gary Barber; their plan to take over the studio after it emerges from bankruptcy has been approved by MGM's lenders, reports the LAT. The vote was delayed when Lionsgate's largest shareholder, agitator Carl Icahn, tried to mount a rival bid to buy MGM's debt for 53 cents on the dollar. Icahn also owns about 12% of MGM's debt, or $500 million.
Icahn did manage to change the terms of the deal, reports the LAT:
Icahn cut a deal with MGM's creditors to support the Spyglass plan in exchange for a seat on the company's nine-person board of directors after the beleagured studio exits bankruptcy, a person familar with the situation confirmed.
As part of the deal, the creditors agreed, at Icahn's insistence, to change the arrangement with Spyglass so that its library of about 15 titles will no longer be merged into MGM. As a result, Spyglass will not get a 5% equity stake in the reorganized MGM, as originally planned. Icahn had believed that Spyglass's movies, including "The Sixth Sense" and "Seabiscuit," were being overvalued.
Under the bankruptcy plan, MGM's creditors will swap all of their debt in exchange for more than 95% of the studio's equity.
Because of the last-minute agreement, Icahn voted his debt, which totaled between 12% and 20%, for the Spyglass plan.