Sony Corp. said today (May 19) it is in exclusive negotiations with movie studio Metro-Goldwyn-Mayer on a possible takeover that could bolster its film library but put a dent in its finances.

Sony Corp. said today (May 19) it is in exclusive negotiations with movie studio Metro-Goldwyn-Mayer on a possible takeover that could bolster its film library but put a dent in its finances.

Sony vice chairman Howard Stringer said at the electronics and entertainment conglomerate's annual strategy meeting in Tokyo that it was "preparing an exclusive analysis" of MGM and that it was "four or five days" into a 20-day negotiating period.

Representatives of MGM and Sony have previously declined to comment on published reports about the negotiations.

The deal would provide Sony with access to MGM's 4,000-plus film library that includes the James Bond and Pink Panther titles.

"This is a business that we have persevered with since the 1990s ... and we do not plan to acquire a business that will result in a loss," Sony CEO Nobuyuki Idei told a news conference.

Sony's acquisition of Columbia Pictures in 1989 for $3.4 billion, which at the time was the largest-ever acquisition by a Japanese firm, caused numerous headaches for Sony due to losses from elaborate spending budgets and box-office duds.

Stringer, the executive in charge of Sony's entertainment business, said the company was not rushing into anything.

"We're being very conservative," he said.

A Sony official said the talks were not necessarily about an acquisition price, but a chance for Sony Pictures to conduct due diligence on MGM, which is 74% owned by 86-year-old billionaire Kirk Kerkorian and his Tracinda Corp. investment firm.

In April, MGM delayed its annual shareholders' meeting from its scheduled date in May to late June, giving it more time to proceed with what industry sources called late-stage talks on a $5 billion takeover offer from Sony.

--Reuters

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