The antitrust regulator of the European Union has reportedly approved American giant Amazon’s proposed takeover of Metro-Goldwyn-Mayer (MGM) for $8.5 billion. Due in part because MGM's content cannot be classified as ‘must-have’.
According to reports, the acquisition is currently still awaiting approval from the United States FTC.
The European Commission approved the agreement proposed in May 2021 earlier this week. The commission stated that the deal will pose no concerns of competition in the European Economic Area (EEA).
The European Commission concluded that the deal would not substantially decrease competition in the markets for audio and visual content distribution and production, retail supply of audiovisual services, wholesale supply of television channels, licensing, and production of distribution rights to third-party distribution companies of films for cinematic release, as well as the requirement of marketplace services on the basis of its market investigation.
According to reliable sources, Amazon has given the Federal Trade Commission until mid-March to give a ruling on the transaction's clearance. Per source, if the FTC does not initiate a legal challenge before that timeframe, Amazon would be proceeding with the deal.
MGM, which was founded in 1924, would provide Amazon with a library of over 4,000 films and 17,000 television series, including the Pink Panther, James Bond, as well as Rocky movie franchises.
According to Mike Hopkins, executive VP of Amazon Studios and Prime Video, the actual financial value behind this transaction is the treasure chest of intellectual property in the deep archive that the firm hopes to rethink and develop along with MGM's great staff.
The European Commission stated that the overlaps involving Amazon's and MGM's activities are minimal in its antitrust investigation.
The Commission observed that Amazon faces strong competition from other rivals even in national markets where the e-commerce giant has a sizeable presence in the video streaming services domain. The commission concluded that incorporating MGM's material into Amazon's Prime Video service would not have had a substantial impact on Amazon's presence as a marketplace services provider.