Will MGM Sell Their Rights To ‘The Hobbit’ To Warner Bros. And Set It Free?

As word on Jackson potentially directing the film made its way like wildfire around the internet, he spoke out about the rumors saying that it’s still “just an option,” confirming word from the trades that any deal involving his directing the film would need to be done quickly or the filmmaker would move on. But it doesn’t look like its going to happen.

The Hollywood Reporter reports that MGM is seeking yet another debt extension from their lenders who are already holding nearly $4 billion in debt. If only banks were as nice to regular citizens who miss a mortgage payment. Anyway, it’s expected they will receive the extension which will allow MGM more time to work out a potential partnership or buyout from another studio.

As for “The Hobbit,” apparently there is difference of opinion between MGM executives and their lenders keeping the company afloat as to what to do with the studio’s lucrative property. Obviously, the studio wants to hang on to the rights, but lenders are said to be lobbying for the cash-strapped MGM to sell the rights to “The Hobbit” to Warner Bros. whose New Line division is producing the film. If the rights move it could change the structure of how the film is produced completely. Would Warner Bros. take on the cost of the film themselves? Or would they, most likely, partner with a new studio? If the rights move, it’s another delay, more paperwork and more time added to the already halted production to sort things out.

THR claims the film is aiming for a January shoot, but with MGM possibly undergoing corporate re-structuring, and with the film still without an official greenlight, director or cast it will take a number of complex, careful steps to manage a studio buyout or partnership as well as getting a major franchise into production. Moreover, the studio is still seeking an infusion of cash that will keep the doors open for the next few years allowing MGM to get on with the business of making and releasing movies. But without that cash, things will remain at a near standstill.

In short, things don’t look optimistic and actors have to eventually move on and take other jobs (Jackson has already hinted that they’ve done initial cast testing, but nothing’s officially been announced other than the usual suspects). There are still a lot of hurdles for “The Hobbit” to navigate to get running. Could the film make a January start date? Most certainly, but whether or not it will have Peter Jackson directing seems more and more unlikely. As the clock ticks, the likelihood of his involvement beyond a producing and writing capacity seems less and less probable. Only time well tell, but we’re surprised that no leaked casting has got out there in the meantime. Some actors and agents who have tentative offers, but are nervously looking at a calendar each day.