United Artists Secures $500 Million in Production Financing Arranged by Merrill Lynch

United Artists Secures $500 Million in Production Financing Arranged by Merrill Lynch

LOS ANGELES, Aug. 16 /PRNewswire/ -- United Artists Entertainment LLC (UA) announced today that it has secured $500 million in financing through Merrill Lynch, one of the world's leading wealth management, capital markets and advisory companies. The arrangement provides the studio with financing for the production of 15 to 18 films over the next five years. The specific terms of the transaction are not being disclosed.

UA's slate will include a combination of films it develops itself, films that are co-produced or co-financed with other major studios or independent partners, and films that may be acquired through negative pickups or other distribution agreements. The studio expects to release four to six films annually, with green-light authority continuing to vest in UA co-owners Tom Cruise and Paula Wagner, who also serves as the studio's chief executive officer. UA is a partnership between Cruise, Wagner and Metro-Goldwyn-Mayer Studios Inc. (MGM).

The financing is effective immediately and will cover two UA film projects already in the works -- "Lions for Lambs" and "Valkyrie." Directed by Academy Award(R) winning director Robert Redford and starring Redford, Meryl Streep and Tom Cruise, "Lions for Lambs" will be released in the U.S. and abroad on November 9, 2007. "Valkyrie," a WWII thriller directed by Bryan Singer, with Tom Cruise leading an international cast that includes Kenneth Branagh, Bill Nighy, Tom Wilkinson, Carice Van Houten, Eddie Izzard, and Terrence Stamp, is currently filming in Germany and will be ready for release in the summer of 2008.

"The closing of this financing is an important milestone for the new United Artists," said UA CEO Wagner. "It leaves us perfectly poised to realize our vision of making movies that are both important and commercial. We are fortunate to have a team of talented executives who know how to nurture and develop a slate with ingenuity as well as financial discipline, and we're buoyed by the enthusiasm of our friends throughout the international film community. And, of course, Tom and I greatly appreciate the support we've received from Merrill Lynch and MGM."

Harry E. Sloan, Chairman and CEO, MGM, added: "We are pleased that this new United Artists financing arranged by Merrill Lynch supports the MGM model, providing a solid foundation for its production while also creating a pipeline of high quality films for worldwide distribution by MGM. We are also pleased to see such strong support from Wall Street for Tom and Paula and their team, which has enabled us to close this significant transaction within nine months of launching a new UA."

Michael Blum, Managing Director and Global Head of Structured Finance & Investments at Merrill Lynch, said: "The structure and terms of this financing provide the necessary flexibility for United Artists to achieve its production goals while also attracting strong interest from international investors. The participation in this transaction by over 15 institutional investors based in the U.S., Europe, Asia and Africa demonstrates strong and diverse demand notwithstanding a very challenging market environment."

About United Artists

United Artists Entertainment LLC was formed in November 2006 under a partnership between Tom Cruise, Paula Wagner, and Metro-Goldwyn-Mayer Studios Inc. (MGM), with Wagner serving as Chief Executive Officer. The historic United Artists brand was initially founded some 85 years ago by movie greats Douglas Fairbanks, Charlie Chaplin, Mary Pickford, and D.W. Griffith and, throughout its history, has appeared on such iconic film franchises as Rocky, The Pink Panther, and James Bond.

About Metro-Goldwyn-Mayer Inc.

Metro-Goldwyn-Mayer Inc., through its operating subsidiaries is actively engaged in the worldwide production and distribution of motion pictures, television programming, home video, interactive media, music and licensed merchandise. The company owns the world's largest library of modern films, comprising around 4,000 titles. Operating units include Metro-Goldwyn-Mayer Studios Inc., Metro-Goldwyn-Mayer Pictures Inc., United Artists Films Inc., Ventanazul, MGM Television Entertainment Inc., MGM Networks Inc., MGM Distribution Co., MGM International Television Distribution Inc., Metro- Goldwyn-Mayer Home Entertainment LLC, MGM ON STAGE, MGM Music, MGM Worldwide Digital Media, MGM Consumer Products and MGM Interactive. In addition, MGM has ownership interests in international TV channels reaching nearly 110 countries. MGM ownership is as follows: Providence Equity Partners (29%), TPG (21%), Sony Corporation of America (20%), Comcast (20%), DLJ Merchant Banking Partners (7%) and Quadrangle Group (3%). For more information, visit http://www.mgm.com/.

About Merrill Lynch

Merrill Lynch is one of the world's leading wealth management, capital markets and advisory companies with offices in 38 countries and territories and total client assets of approximately $1.7 trillion. As an investment bank, it is a leading global trader and underwriter of securities and derivatives across a broad range of asset classes and serves as a strategic advisor to corporations, governments, institutions and individuals worldwide. Merrill Lynch owns approximately half of BlackRock, one of the world's largest publicly traded investment management companies with more than $1 trillion in assets under management. For more information on Merrill Lynch, please visit http://www.ml.com/.

Media Contacts:

For United Artists:
Allan Mayer or Kelly Mullens/42West
(310) 477-4442
allan.mayer@42west.netkelly.mullens@42west.net

For MGM:
Jeff Pryor
(310) 449-3446
jpryor@mgm.com

For Merrill Lynch:
Terez Hanhan
(917) 575-8642
terez_hanhan@ml.com

First Call Analyst:
FCMN Contact:

Source: United Artists Entertainment LLC

CONTACT: Allan Mayer, allan.mayer@42west.net, or Kelly Mullens,
kelly.mullens@42west.net, +1-310-477-4442, both for United Artists
Entertainment LLC; or Jeff Pryor of Metro-Goldwyn-Mayer Inc., +1-310-449-3446,
jpryor@mgm.com; or Terez Hanhan of Merrill Lynch, +1-917-575-8642,
terez_hanhan@ml.com

Web site:

http://www.mgm.com/
http://www.ml.com/

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