MGM Lenders Extend Deadline For Debt Payments

(Reuters) – Metro-Goldwyn-Mayer [MGMYR.UL] said on Wednesday that its lenders agreed to extend a deadline for debt payments as the film studio prepares to be handed over to film company Spyglass Entertainment.

A source familar with the matter said last week that the founders of Spyglass signed a nonbinding letter of intent to take over MGM, which is struggling with about $4 billion of debt after being bought out in 2005.

The buyers included private equity firms Providence Equity Partners, TPG, Quadrangle Group and DLJ Merchant Banking Partners, and media companies Sony Corp (6758.T) and Comcast Corp (CMCSA.O) [ID:nN14140503].

Sources have said MGM was aiming to file a prepackaged bankruptcy as part of the Spyglass plan.

(Reporting by Sue Zeidler. Editing by Robert MacMillan)