Hand-Wringing at MGM as Sony Takeover Nears

Producer David Ladd has three films in development at Metro-Goldwyn-Mayer Inc., including his pet project, a baseball-themed movie called “Man on Third.” But now he’s worried whether his picture will ever get up to bat.

Ladd, along with scores of other filmmakers, directors, writers and rank-and-file MGM employees, see their future plans jeopardized by the proposed purchase of the studio by Sony Corp.

“It’s awful,” Ladd said Wednesday. “These projects are like your children. You nurture them and raise them. You get a director, and things start to take off. You begin making the movie in your head -- and then spending the profits.”

With the months-long drama over who would buy MGM seemingly settled, the focus has shifted to who and what will survive. Few high-level MGM executives are expected to be kept employed by Sony. What’s more, fewer studio hands will be needed because the Japanese electronics giant is expected to turn MGM and its United Artists unit into smaller subsidiaries, producing six films a year or maybe fewer.

MGM executives on Wednesday began meeting with employees for the first time since Monday’s announcement of the proposed takeover of the studio. Sony offered to pay $2.9 billion in cash and assume $1.9 billion in debt.

The prospect of mass firings throughout MGM’s hierarchy was foreshadowed in May when workers were offered severance packages in anticipation of the sale. Depending on length of service, they could qualify to receive the equivalent of their salaries for up to two years.

The planned sale of MGM is expected to be more wrenching than NBC’s purchase in May of Vivendi Universal’s entertainment assets. The General Electric Co. unit, unlike Sony, did not have a film studio and had made clear it would keep intact the management team at Universal Studios.

Rumors of a sale have dogged MGM for so many years that one former executive said, “Everybody developed some form of an immune system.”

Nonetheless, news of the proposed takeover hit some employees hard, rattling nerves and ratcheting up the anxiety level on production sets and in executive suites.

“Every executive is fearing for their job, every production company is fearing for their overhead,” one producer said.

Unlike other studios with sprawling back lots and bungalows filled with producers seeking homes for their projects, MGM is a considerably smaller enterprise, operating largely out of a Century City office tower.

Still, its acquisition by Sony would mean one fewer place for agents and producers to go in a world already condensed by a wave of media company mergers and acquisitions.

Although it appears MGM’s current slate of releases will go forward, it’s unclear what will happen to pending deals at the studio and projects that had been envisioned.

“I have no idea what’s going to happen,” said Dylan Sellers, who was a producer for MGM’s “Agent Cody Banks” series. He has three projects at MGM. “You just get kind of hardened to all of this stuff,” he said.

But it’s hard not to get discouraged, he said. “The people who bought your project are invested in it, and then you get a new group of executives and they’ve never heard of it and they have no interest in it. Then you have to sell it all over again.”

Spokeswomen for both Sony and MGM declined to comment.

Since late last year, when suitors started seriously pursuing MGM, the studio downshifted production.

Top MGM executives, company sources said, have told their staff to press ahead with plans for next year’s slate of films. Those include “Beauty Shop,” a spinoff of MGM’s popular “Barbershop” series, which will star Queen Latifah; “Be Cool,” a sequel to “Get Shorty,” starring Uma Thurman and John Travolta; and “The Pink Panther” with comedian Steve Martin.

“You just anticipate that the merger is going to happen, and you keep making your movie,” said “Beauty Shop” executive producer Todd Lieberman.

Sources said that, while the deal with Sony is being finalized, MGM would continue to greenlight at least three other pictures but would not take any big risks.

Jay Cohen, a producing partner in actress Goldie Hawn’s film company Cosmic Entertainment, said they had received a nod from MGM to make “Mad Money,” with Queen Latifah and Diane Keaton. Director Callie Khouri has signed on too.

“We just got some notes back on the script, and they said they still want to make it,” Cohen said.

David Ladd, who recently hired the respected Irwin Winkler to direct “Man on Third” -- a story of strained relations between two brothers, one a teacher, the other a Los Angeles Dodger -- is hoping his movie doesn’t get caught in the latest consolidation squeeze play.

“I’ve been through this a couple of times before,” said Ladd, the son of the late actor Alan Ladd. “But like every other producer who has a project there, we’re saying, ‘Hopefully it’s our movie that they’re making.’ ”