MGM board to look at ways to finance video buyout

The board of directors of movie studio Metro-Goldwyn-Mayer Inc. MGM will meet on
Thursday to begin looking at ways to fund a recent $225 million buyout of its video distribution contract with Warner Bros.

A source with knowledge of the board meeting said MGM has several options, including an offering of rights to purchase MGM stock
or an extension of its current line of credit.

He said MGM might raise more than the $225 million to meet long-term financing needs, but any decision about the type or amount of
funds may not be made for months. He added the studio has plenty of available funding to meet current requirements.

MGM is 90 percent owned by Tracinda Corp., the Las Vegas-based investment wing of billionaire Kirk Kerkorian, and as such is not
expected to have difficulty raising the money.

Last week, MGM agreed to pay Warner Bros. $112.5 million in cash and another $112.5 million plus interest on Sept. 1, to regain
home video distribution rights from Warner Bros.

At that time, MGM said it would consider various means — including debt or equity financing — to fund the purchase.

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