Financial strife has been rife in the realm of the Stargate franchise, not only has Cheyenne Mountain Entertainment filed for chapter 11 bankruptcy protection it looks like MGM studios will soon be following their path.
MGM have been looking to restructure their $3.7 billion debt levels for some time, however the struggle hasn’t abated it looks increasingly likely the firm will file for chapter 11 bankruptcy protection in the coming weeks if a potential buyer is not found.
The Hollywood reporter is quoted
With MGM debt recently trading at 60 cents on the dollar that would mean the studio would have to sell for more than $2.2 billion to fully pay off lenders. But almost nobody sees the Lion fetching that sort of money…
If a top bid for MGM fails to find enough support among its more than 140 lenders, the only other option would be a debt restructuring. That probably would include a pre-packaged bankruptcy reorganization by which lenders would morph into owners and present owners would see their stakes heavily diluted.
What does this for the future of the Stargate Franchise? Currently production costs are shared between MGM and SyFy, so any potential buyer of MGM may decide to axe Stargate Universe after its second season depending on how DVD sales play out.
Of course the studio may decide to cancel production on Stargate Universe Season two before it even begins, especially when considering the recent Blu-Ray 1.0 release failed to make the top 100 list over at Amazon.
Stay tuned for further information as and when it breaks.