No Interest in Selling, MGM Says

Metro-Goldwyn-Mayer Inc., owner of one of the world’s largest film libraries, said it has no interest in selling the company, responding to speculation that owner Kirk Kerkorian is preparing it for a sale.

“We have absolutely no interest in selling. Our entire focus is on building the company,” said Alex Yemenidjian, an MGM director and chairman of the board’s executive committee.

MGM said earlier this week that it had agreed to pay $225 million to Time Warner Inc.’s Warner Bros. studio to put an early end to a restrictive long-term home video distribution agreement that some analysts said has made MGM less attractive to potential suitors.

The Santa Monica-based company sold off video distribution rights to its film library in 1990 in a 13-year agreement with Warner Bros.

That meant MGM has had to distribute all its videos worldwide through Warner Bros. and pay it a 10% to 15% fee.

In addition, a clause in that agreement requiring any acquiring company or MGM affiliate to distribute its videos through Warner Bros. has deterred some potential buyers, analysts have said.

The agreement also required MGM to get approval from Warner Bros. before selling video rights to its productions, which hurt MGM’s ability to set up co-productions.