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Dyin’ Lion?

March 26th, 2010

With this weekend’s opening of “Hot Tub Time Machine,” MGM is doing something they rarely do anymore: release a film. The historic studio’s last release was 2009’s “Fame,” which faded quickly after its September bow. And there’s little on the horizon for once-proud Leo the Lion; the only other films the studio has announced are “The Cabin in the Woods,”  “The Zookeeper” and a remake of “Red Dawn.”  It’s a sad state  of affairs for the studio, which ultimately put itself on the block in November of 2009. 


Giancarlo Parretti

 [In the interest of full disclosure, I worked at MGM for five years in the early 1990s, when it was purchased by flamboyant Italian ‘financier’ (read: con artist) Giancarlo Parretti. Previous owner Kirk Kerkorian, who’d made a nice living selling-and-then-re-buying MGM to/from Ted Turner, sold the stripped-down studio to Parretti for $1.3 billion. Parretti promptly began to loot the corporate coffers while installing a cadre of cronies to help relieve the studio of the rest of its assets. Eventually, unpaid vendors threatened to sue, and Parretti’s bogus purchase unravelled – especially once it became known that Parretti’s ‘elaborate empire’ of Italian companies were merely shell corporations, and ‘his’ billions simply didn’t exist. The bank that had loaned Parretti the money was caught up in the scandal, and the whole thing played out in Delaware Chancery Court, where MGM  was registered as a corporation. Parretti fled to Italy after a fraud conviction; last I heard, he was in Italian politics. Quel suprise!]    

Alan 'Laddie' Ladd, Jr.

  So MGM is for sale (again). During and after Parretti, MGM was led by respected Hollywood studio head and producer Alan ‘Laddie’ Ladd, Jr., who did his best to keep the pipeline filled with ‘product,’ but falling revenues and a reputation as ‘the studio of last resort’ kept MGM in decline. Ladd was eventually replaced by Frank Mancuso, Sr., who had been canned by Paramount; in spite of this, Mancuso wrangled a $10 million settlement from his former employer before he would leave. Obviously seeing an opportunity, Laddie did the same thing: although given his walking papers by the MGM board, Laddie chose to report to work every day as though nothing had happened. Oddly, Mancuso arrived to run the studio, and we studio employees were in the strange position of having to deal with TWO ‘studio heads,’ as Laddie remained in his office, and Mancuso occupied     


Frank Mancuso, Sr.

  another large suite just a few doors away. Ultimately, lawyers saved the day, and Laddie ‘ankled the studio,’ as they say in “Daily Variety” with a large chunk o’ change – and the studio’s pet project, a little picture called “Braveheart.” Eager to out-do Laddie, MGM rushed their own historical epic into production, but “Rob Roy” was no “Braveheart.” Instead, in 1996, Laddie stood on the stage at the Academy Awards alongside Mel Gibson and Bruce Davey to accept the Best Picture Oscar. And to add insult to MGM’s ‘injury,’ Ladd made “Braveheart” at Paramount, the former studio of his replacement, Mancuso.   


Mancuso eventually left MGM after an uneven series of films: his son Frank Mancuso, Jr. replenished some of the studio’s accounts with genre-driven fare like the “Species” series and John Frankenheimer’s “Ronin.” But the studio stayed in decline, moving through toppers, and eventually entered into a strategic partnership with Sony and two venture capital firms. While Sony did its best to exploit the MGM film library for the then-nascent DVD business, corporate troubles mounted for MGM, and they eventually pulled out of the partnership; following a series of interim chiefs, internet billionaire Harry Sloan took over the studio. Because MGM merged with United Artists in 1980 after the debacle of “Heaven’s Gate,” Sloan was essentially running MGM/UA, and Mary Parent, a former Universal topper, was brought in to revive the UA label, with the help of high profile producer/star team of Tom Cruise and Paula Wagner. Their effort with A-list director Bryan Singer, “Valkyrie,” experienced problems during production and, despite fair reviews, did not generate the boffo B.O. MGM/UA was hoping for (and desperately needed). “Lions for Lambs,” another Cruise UA effort, met an even worse fate at the box office, despite a stellar cast inclusing Meryl Streep and Robert Redford.       

With the faltering box office returns of ‘Lambs,’ “Valkyrie,” “Fame” and a few other odds and ends, MGM brought in renowned asset-stripper  Stephen Cooper in November of 2009. Although the studio had seemingly been on the brink a number of times before, the presence of Cooper suggests that the studio is in its final throes.       

And now MGM has “Hot Tub Time Machine.” Although it stars “Daily Show With Jon Stewart” favorite Rob Corddry and “2012”‘s Jon Cusack, reviews suggest the film will cool off quickly, and leave the studio back in its current troubles. At present, there are two binding bids for Leo the Lion. One is a bid by Time Warner, the other is by Access Industries, a company controlled by Les Blavatnik. An offer of $1.3 billion (does that amount sound familiar – even 20 years later?) was rescinded by Lionsgate, which is mired in a nasty takeover bid of its own by corporate raider Carl Icahn. But the ultimate decision of whether to sell MGM lies with its 140 debtholders – and if the two current bids aren’t to their liking, MGM could do its best to continue to be a going concern, especially if a hoped-for refinancing of their crushing $3.7 billion debt can be arranged.       


Otherwise, it’ll be time for corporate dismantler Stephen Cooper to auction off the rest of the once-proud Lion, one piece at a time…

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