Gandalf Ready to Start Shooting THE HOBBIT in January, Is MGM Ready?

Over the past week or so, there have been indications that The Hobbit is moving forward and will start shooting some time early next year. MGM’s much publicized financial troubles are the major crossroad to getting things started. Recent talks of companies buying out the studio, most notably Spyglass Entertainment, could alleviate those problems and get current projects in MGM’s pipeline moving again. The two with the highest visibility are the long-awaited prequel to The Lord of the Rings and the next installment of the Bond series.

In a recent interview with The Bolton News Sir Ian McKellen touched on potential start to production. “The aim is to start filming in January,” he said. The actor also made it clear that he wouldn’t be “sitting waiting” for shooting to start. There had been previous rumors floating around whether or not McKellen would even return to the role so this at least confirms he will be there providing any scheduling conflicts that may arise. The studios will assuredly go to great lengths to address those.

Martin Freeman is the other actor making news recently for The Hobbit. He reportedly turned down the role last week in order to fulfill his commitment to shoot the BBC series Sherlock, in which he plays Dr. Watson. EW reported “New Line and MGM, the studios backing the Hobbit films, have since come back to Freeman with a proposed schedule that would allow him to shoot both projects. All parties are currently negotiating a deal.”

Those are both good signs that production is moving forward on the project. It also lends credence to Peter Jackson directing the movies which he has been publicly opposed to. Shooting in January would not give any other director very much time on pre-production. Jackson, who is one of the producers, has been with the project from day one.

Everything comes down to MGM getting out of their financial crisis in order for shooting to truly take place. Many offers by other studios (Lions Gate, Warner Bros.) have been put on the table but Spyglass Entertainment’s merger proposal has emerged the frontrunner and is close to striking a deal.

Bloomberg News is reporting that Metro-Goldwyn-Mayer would hand over management to Spyglass Entertainment Group’s Gary Barber and Roger Birnbaum making them co-chairmen and co-chief executives. The production company signed a non-binding letter of intent on Sept. 8. Before the two can assume control of MGM, however, the studio's more than 100 debt owners and its board of directors must approve the deal and file the prepackaged bankruptcy. Spyglass owners would also receive a 5% stake in MGM’s vast film library.

Time is of the essence as MGM’s sixth forbearance on interest payments on its debt load expires today, Sept. 15. All sides are said to be looking for another extension in order to finalize the deal. Their total debt is valued at $3.7 billion dollars. Bloomberg also is reporting that:

The restructuring plan also would allow closely held MGM to seek a line of credit to fund its operations and avoid having to raise additional equity beyond what would be created through the debt swap, said one of the people, who has taken part in the discussions. The studio was taken private for $5 billion in 2005 by investors including Providence Equity Partners.

Spyglass had no comment when I reached them yesterday. At this point, there is light at the end of the tunnel for the literally hundreds of interested companies, vendors, and key individuals. Final resolution on the deal is said to come near the end of the year.