Carl Icahn Adds Anti-Spyglass Vote to MGM Debt Offer

5:12 PM PST 10/27/2010 by Carl DiOrio

Investor tells creditors he would buy their debt holdings for 50 cents on the dollar provided they vote against a reorganization proposal involving Spyglass.

In the course of a week, famously facile investor Carl Icahn has offered a menu of choices for MGM lenders looking to unload their debt holdings.

In his latest offer, Icahn told Lion creditors Wednesday he would buy their debt holdings for 50 cents on the dollar provided they vote against a reorganization proposal involving Spyglass Entertainment. Icahn is backing a rival MGM reorg plan based on a merger with Lionsgate, where he is the largest shareholder.

Last week, he offered the MGM debtholders 45 cents on the dollar -- the approximate current market value -- and Tuesday he offered 53 cents on the dollar for the studio's publcly traded debt. But unlike those two proposals, Icahn in his latest offer placed no minimum on the amount of debt that had to be transferred.

Icahn already holds more than $400 million of MGM's roughly $4 billion in debt.

More than 100 MGM creditors have until Friday to vote yes or no on the Spyglass proposal, which would give them 95% of the studio's equity and Spyglass co-toppers Gary Barber and Roger Birnbaum operating control of the studio.

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