Metro-Goldwyn-Mayer Inc. has agreed to an exclusive seven-year pay TV deal with Viacom Inc.'s Showtime Networks that is said to be valued at $800 million to $1 billion.
Under the agreement, Showtime gains exclusive rights to MGM and United Artists theatrical films released after Sept. 1, 1994. The agreement covers up to 150 theatrical releases. Showtime and MGM will also jointly finance production of movies for Showtime.
The deal, MGM's biggest pay TV agreement ever, is part of an effort by MGM Chairman Frank Mancuso, who formerly headed Paramount Pictures, to rebuild the studio. The French bank Credit Lyonnais, which took possession of MGM after former owner Giancarlo Parretti defaulted on his loans, must sell the studio by 1997, as required by U.S. banking laws.
Not covered by the deal are films produced by Carolco Pictures, which MGM will begin distributing next year after Carolco's current distribution deal with Tristar Pictures expires.