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Amazon Closes $8.5-Billion Deal to Acquire Hollywood Studio MGM

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Highlights:

  • Amazon closed its $8.5 billion deal to buy MGM, combining the fabled movie maker behind “Rocky” and “James Bond” with the online retailing giant.
  • Its decision to close comes after a deadline passed for the U.S. Federal Trade Commission to challenge the deal.
  • MGM bolsters Amazon Prime Video’s offering with more than 4,000 film titles.

The Amazon tech giant has closed its $8.5 billion deal to acquire MGM, the home of the Bond franchise and one of the most iconic movie studios in Hollywood history. The move looks to bolster the company’s position in the entertainment world while giving its streaming service, Amazon Prime Video, even more content to fill its already extensive library. This should help Amazon challenge rivals such as Netflix and Disney+ in the hyper-competitive streaming market.

In a statement, Amazon said it would welcome all MGM employees to the company and work with the studio’s leadership, indicating there would not be layoffs. Its decision to close comes after a deadline passed for the U.S. Federal Trade Commission to challenge the deal. The European Commission approved the deal, with no conditions.

Amazon Closes $8.5B MGM Acquisition

The Company praised the deal in a blog post, saying MGM has more than 4,000 film titles, 17,000 TV episodes, and awards that “will complement Prime Video and Amazon Studios’ work in delivering a diverse offering of entertainment choices to customers.”Amazon plans to draw on the vast MGM library, with famous characters such as Rocky, RoboCop, and Pink Panther, to create new movies and shows.

The deal close came after the window for U.S. regulators to challenge it closed, though the Biden administration has warned companies that it reserves the right to challenge some deals even after they are completed. European regulators signed off on the merger earlier this week, writing in their approval that the deal “would not significantly reduce competition” and that “the overlaps between Amazon and MGM are limited.”

In the U.S., some labor groups had asked the FTC to challenge the acquisition, arguing that Amazon’s status as a producer and distributor of content, as well as of devices like the Amazon Fire products, would give it unwarranted market share and pricing power.

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